13:56 20 February 2013
Reports released last year by Pensions Policy Institute suggested that almost half of those people who are 45-50 years old may need to work until they reach 70 in order to afford a comfortable retirement.
The reasons for this includes; increase in living expenses in recent years, lower-than-expected annuity returns, higher costs for educating and raising children, and high unemployment rates.
Because of this, it’s more crucial for people to efficiently plan for their retirement. By doing this, you wouldn’t have to work until you’re 70 years old. You can just enjoy your golden years taking holidays and doing other things that you love.
Here’s how you can boost your retirement funds:
1.Saving vs. investing. A lot of people put money into their savings account. This isn’t recommended by financial advisors as the interest rate of most savings account isn’t enough to beat inflation. The money that you have right now will lose its buying power in years to come. What you can do is to find investment vehicles that will give you better earnings. Depending on your risk appetite, you can do stock trading or consider mutual funds.
2.Diversify your investment portfolio. Diversification is very important in the world of investing. You should not put all your resources in one basket to ensure that you will not lose them all in case something bad happen to your choice of investment vehicles.
3.Find other sources of income. One of the best things that you can do is to make passive income. This means that you’ll earn money without you working for it. An example of this is renting your property or earning dividends through the stock market.
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