In your 20s? Why retirement planning should be a top priority
Michelle Acton of Old Mutual Corporate emphasises the importance of proactive retirement planning for all working South Africans.
Retirement Planning, Personal Finance, 123rf.com
702 and CapeTalk's Africa Melane interviews Michelle Acton of Old Mutual Corporate.
Listen below:
If you're in your 20s, retirement may seem like a lifetime away, but Acton says it's never too early to start planning.
With minimal state-based support, South Africans must take charge of their own retirement savings to secure their future.
Acton warns against waiting too long to start saving.
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"We have very little support, other than the old-age state grant, so it is everybody's individual responsibility."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
Acton also warns against thinking that retirement is a far-off, distant event.
"Often, retirement feels an exceptionally long way away and something I can worry about as it gets closer."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
Don't rest on your laurels because it takes a long time to save for retirement, warns Acton.
"The average person is on retirement for 10, 15, 20, sometimes as much as 30 years, so you need to ensure you plan appropriately."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
Something that can be useful is to carry out an annual retirement review, suggests Acton.
"Just to check if you are on track."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
So, where to start for those who haven't yet begun saving?
Just start, says Acton, even if it's only a small amount.
"There's a rule of thumb that says 15% of your income for 40 years should put you on the right track."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
"We find that for a lot of people, they reach their mid-40s and start going, 'Oh, I need to start saving for retirement'. But you've only got 15 years left."
- Michelle Acton, Chief Customer Officer - Old Mutual Corporate
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Scroll up to the audio player to listen to the interview.