Your guide to saving for retirement when middle-aged

Are you approaching 40? Then, you really need to start saving for retirement.

10:25 18 April 2013

Saving for retirement is extremely important. You may not realize this when you are 20-30 years old. But as you get older, you need to think about what will happen when you stop working. If you’re 40 years old now, you’ve got at least 20 years to start planning for your golden years.

Usually, at this age, children are going to college. This makes it hard for a lot of people to put money to their retirement fund. One way to deal with this is to ask your children to get a part-time job to help with the expenses and/or to apply for a scholarship.

When saving, start calculating how much you’re going to need to have comfortable retirement. Then, you’ll easily figure out how much you need to put away each month to realize your goal in time. I know, this is easier said than done.

You may need to sacrifice some things in order to make this happen. Your thrice-a-week dinner in expensive restaurants may need to be reduced or you may need to pass up on travelling outside the country once in a while. However, be assured that it’s worth it.

Instead of putting your savings on regular savings account, augment your earnings by investing your money. As you have 20 years before you hit retirement, you may consider stocks and shares ISA or mutual funds. Choose based on your goals and risk appetite. Happy saving!