Preparing for retirement might seem overwhelming, but it's important to protect your financial future and ensure you can truly enjoy your golden years. Without proper retirement advice and planning, the dreams of travelling the world, exploring beautiful places like Badulla and Bandarawela, embarking on hikes, or visiting religious and historical sites may remain just that-dreams. Effective retirement planning turns these aspirations into achievable realities.
Why?
Why is it so important to plan retirement? Imagine exploring new destinations, immersing yourself in nature’s beauty, and experiencing cultural and historical richness during your retirement years. Whether it’s jetting off to exotic locations or finding peace in your favourite local spots, retirement can be as fulfilling and adventurous as you desire-if you plan retirement effectively.
A key reason to plan retirement is the desire to maintain your current lifestyle even after you stop working. Retirement advice isn’t just about financial security; it’s about preserving your happiness, avoiding becoming a financial burden on your children, and comfortably managing daily expenses. By preparing for retirement, you ensure you can continue living life on your terms.
The importance of preparing for retirement
The importance of preparing for retirement becomes even clearer when you look at the reality in Sri Lanka:
● Almost 50% of retirees don't have a pension income.
● 85% of people aged 20 - 59 in the private sector are not covered by any pension scheme.
● 81% of the employed population don’t have a government-backed pension scheme.
● Only about 19% of the employed population have a government-backed pension scheme.
● Sri Lanka is ranked 53rd out of 73 countries in the Comfortable Retirement Ranking Index.
These statistics highlight why it’s vital to start preparing for retirement as early as possible. But how do you begin? Here are some essential reasons why planning for retirement is a must:
- You Need a Steady Income During Retirement
A primary reason for retirement planning is to secure a steady monthly income that supports you throughout your retirement years. Whether through Smart Pension Plans, investments, or savings, having a reliable income stream ensures you can maintain your lifestyle even when you’re no longer working.
2. Uncertainties can arise at any time
Another critical reason to plan retirement is to prepare for life’s uncertainties. A comprehensive retirement plan includes an emergency fund to handle unexpected expenses, offering peace of mind and financial security.
3. Don’t give away your financial independence
Financial independence is a major reason to prioritise planning for retirement. By preparing for retirement now, you can ensure that you won’t need to rely on others for financial support, allowing you to live your retirement years with confidence and peace of mind. Retirement advice like this can help you maintain control over your financial future.
4. Continue to take care of your nearest and dearest
Finally, a well-thought-out retirement plan ensures that your loved ones are cared for. By securing your financial future, you can also provide for those who matter most to you, even after you’re gone. This retirement advice underscores the importance of preparing for retirement not just for yourself but for your family as well.
“Why” is always an important question - and Planning for retirement isn’t just about saving money; it’s about securing a future where you can live comfortably and independently. By starting early and taking the necessary steps, you’re ensuring a fulfilling and worry-free retirement. Don’t wait-start planning for your retirement in Sri Lanka today with these essential retirement tips on how to prepare for retirement!
References:
1. Sunday Times. (2002). Almost 50% of retirees don't have a pension income. Retrieved from [https://www.sundaytimes.lk/020421/bus/8.html]
2. Help Age Sri Lanka. (2008). Tackling Poverty in Old Age: A Universal Pension for Sri Lanka. Chapter 2 Pensions in Sri Lanka: the current situation. International Institute for Applied Systems Analysis. Retrieved from [https://pure.iiasa.ac.at/id/eprint/8707/1/XO-08-006.pdf]
3. U.S. News & World Report. (2023). Best Countries to Retire. Retrieved from [https://www.usnews.com/news/best-countries/best-countries-to-retire]
