Have you made a Financial Plan?

<em>Teri Ann Renee Paisley, Gleaner Online Writer</em>

While having a conversation with a group of forty year olds, the main concern that was expressed was how they would be able to cope with the financial strain as they aged.

Certainly no one in that group looked forward to facing old age in this economic environment.

It is common knowledge that although the government provides assistance to pensioners, it would be a mistake to think that this would be enough to survive.
In fact many choose to retire later as they work to build a ‘nest egg’. Many seniors are also plagued by poor judgment which led to loss of money in the recent get rich quick schemes.

Those who work for companies who offer a pension plan may be in a better position than those who work for the government.
These companies allow their pensioners to reap some rewards after years of hard work.
Unfortunately not all groups of pensioners will enjoy the privilege of having a slightly bigger financial cushion to ease into retirement.

The hardest hit group are those persons who are self employed. These persons struggle to make any significant savings for retirement.

A popular advertisement on television shows an elderly man who is identified as having a successful business in the past but who is now living on the street.
While that may be an extreme example a number of elderly Jamaicans have various issues which can lead to serious financial problems.

How can you prepare for the future?
I have always advocated on this blog the importance of saving and making the effort to think beyond the present. However, I would like to suggest another route for making a long term investment especially for those who are self employed.

Those self employed should consider having their own pension plan.
Many credit unions offer pension plans where you can yield a high return after a few years.
The amount earned depends on how much is put aside as well as the number of years chosen for the investment.

Although it might be tempting, it is better to stick with the plan and not deplete those resources for any reason so that those funds will be available for retirement.
Retirement does not have to be the end of your earning power as seniors can learn new skills or provide needed mentorship to younger persons.

It is always good to have partners that you can train to take over the business but will still keep your financial interest secure.

Having a plan for the future before you reach retirement age is crucial.
Calculate how much money you would spend on your basic needs, utilities and other expenses.
Then add inflation costs and put that amount away on a yearly basis.

So do you have a plan for your future? Let me hear from you!

Tags: budget, savings