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We imagine that everyday you take the time to go about your daily business, whether you are a corporate employee or entrepreneur, the goal is; we all desire to earn enough to take care of ourselves and our loved ones. While we are burdened with surviving the present and the immediate future which most of us see as 2 – 3 years, very rarely do most of us think beyond the short term.
There is a saying that is deeply profound among the Yoruba people, loosely translated; it reads something like this: “Some people are blessed in the morning, some in the afternoon and others at night”. Here is what it means; this suggest that some people will enjoy wealth so early in life, either because they are from privileged backgrounds, the ones blessed in the afternoon means those who enjoy wealth or some level of success at the peak of their lives, either career wise or by virtue of being middle aged. The last category are those who enjoy wealth at the end of their lives; this speaks directly to the elderly who are retired. This saying goes on to say; it is most fortunate to enjoy wealth and comfort in the evening of one’s life!
While this saying may not overly go well with some of our ideologies; we can categorically say that it is a most fortunate thing to be able to enjoy some level of financial wellness at every level of one’s life. It is not a miracle, it requires commitment, seeking knowledge and also the plan to make sure that one is taking the right step at the right time and in the right direction.
Too many of us do not plan for the future especially for when we are no longer able to command the earning power we once had. We do not plan towards the lifestyle we will like to enjoy; and when we do have these dreams of a life outside the daily hustle of work, we are not thinking about what our income will look like at that time.
Too many times in Nigeria, it is a sad reality that retirees have to rely on the largesse of their children or some form of stipend in form of pension/gratuity from the government to be able to take care of their daily needs. Yes, we have all seen this, bore witness to this as some of us may have experienced it personally. The question is, what are we going to do with that experience? Are we going to initiate the step to begin to plan towards the future we desire? Are we going to make smart financial choices now? Or perhaps what you want to know is the things you need to start looking at right now to enjoy all that you want when you retire.
There is no age set for retirement; it is a personal choice based on the goals you set for yourself. However, it is important to note that in your life’s journey there will come a time when you need to retire. So here is what needs to be done. If you are at the beginning of your career, as a 9-5 salary earner or an entrepreneur; you need to start the process by saving towards this goal. The Protrader App offers you a choice to save towards a specific goal either for short, medium or long term duration and this also helps you yield interest. The lifestyle you envision for yourself sets the tone for your financial choices.
STEPS IN PLANNING FOR RETIREMENT
Step 1: Define Your Retirement
Take a practical step to writing down your retirement goals. Have what is called a ‘Vision Board’. The beautiful thing about planning is that it can always be tweaked. A plan is not cast in stone, but it sets your mind to purpose. Your Vision Board allows you to see what is realistic and what is not. As you evolve you may begin to explore opportunities that will guide you to achieving your retirement goals; this also will guide you to seeking expert opinions.
If your goals are still general or vague, that's OK, too. You can simply start by outlining how you envision enjoying your retirement.
Step 2: Take Stock of Your 'Assets'
You know how much you bring home each month, how much you have in the bank and how much you have in your retirement account. But what about those other non-traditional assets that could help fund your retirement? Maybe you collect antiques or restore cars or like some women; you collect jewelleries? Many Nigerians have become quite westernized and the things we collect as something to feed our passion can become major assets.
Being financially savvy is exploring every avenue to create multiple streams of income for yourself and some of them may require you to start out listing your hobbies and skills, what you need to hone those skills and how you can morph those skills to become money spinners for you.
Step 3: Evaluate Your Health — Now
To get the most out of your retirement — and life in general — you want to be as healthy as possible. And while few of us enjoy doctors' visits, a little preventive medical attention can go a long way.
Schedule your check-ups and preventive exams now, from an annual physical checkup to teeth cleaning. At each appointment, work with your Health Provider on a plan to improve or maintain your health. Commit (or recommit) to eating healthy, exercising and getting enough sleep. Healthy living doesn't have to be a chore. Many healthy foods are delicious and satisfying, and exercise can be fun. Commit to staying mentally sharp with brain games, puzzles and books. Staying in close contact with family and friends will help you maintain your health both physically and mentally and may aid in fighting off any blues that may arise once you are retired.
Step 4: Decide How Much You Want (or Need) to Work
This is the classic cost-benefit equation: Unless you are financially set for life, you will have to either stretch limited money and give up some retirement dreams or stay in the workforce (in some capacity) to help pay for those dreams. As you write down your retirement goals, take into consideration how much work is necessary.
In the previous step, you were encouraged to look at your interests. But you should consider your lifestyle and preferences, too. "Work" will mean different things to different people in retirement. Either way, to ensure you successfully reach your goals, you'll have to decide how much time you want (or need) to spend at a job. Don't wait until after retirement to make the decision. Weigh right now the pros and cons of working — including how many hours per week you put into your business. The sooner you get comfortable with this decision, the more secure you will be in your retirement planning.
Step 5: Create a Retirement Budget
Your budget needs to include:
- How much money is coming in.
- How much it will cost to reach the goals you identified in step 1.
- How much debt you have.
Start by tracking your income and expenses for a couple of months. Next, figure out how much money you'll need in retirement to support the lifestyle you envision. You'll also need to do a financial check-up of your investments. Make sure you are diversifying your money into multiple investments, investing in things you understand and going with those investments that won't cost you a ton in fees. If you are carrying debt, make sure your budget includes monthly payments to knock it down. Once you have a budget you know you can stick to, start putting it into action. The Protrader Retirement Calculator can help you take a deeper look at the numbers.
Step 6: Find New Ways to Cut Your Expenses (Start Saving More)
Your retirement may be right around the corner or years away. Regardless, saving more now will always make you better prepared. That doesn't mean all of your extra cash has to go into savings, but now is the time to find new ways to cut your expenses. Start by listing your bills and then figure out ways to trim them. Maybe you don't need 100 cable channels or to eat out three nights a week. Even cutting one movie night a month can bring you closer to your retirement goals.
Got a green thumb? Growing your own vegetables can save you money that can be socked away for retirement. Don't ignore your debt as a way to save more. Cutting your debt now will mean less worry when you retire. One strategy that works for many people: Pay off your smallest debts first, regardless of interest rate. This gives you a sense of accomplishment and empowers you to go after the bigger debts, knowing you have the willpower to eliminate debt.
Step 7: Prepare for the Unexpected
Few of us head into retirement expecting the worst. But sometimes it happens. Prepare for the unexpected now and you won't get caught off guard later. Taking time to consider how you'd pay for — and respond to — everything from minor issues like a roof leak to serious ones like a grave illness will help you weather those storms when they come. Discuss the big issues with your family or those closest to you. How much would it cost to make major repairs? What would you want to do (or what care would you want) if there was an illness in the family?
Step 8: Stick to Your Plan
This step may be challenging but it's definitely rewarding: sticking to your plan. We humans are creatures of habit and it's common to revert to old habits after trying a new course. We have ways of helping you avoid that. Joining our Protrader tribe community will connect you with others going through the same life changes.
The community holds a wealth of information, ideas and tips, and for many is a source of comfort and strength. So join now, build your profile, share photos and even publish a blog. Use the community to tell us how we can help you realize your dreams so you and your family can enjoy the retirement you so richly deserve.
Next, take stock of your protection. Do you have enough insurance on your property to cover a major calamity? Is your health insurance or long-term care insurance adequate? If your insurance coverage lacks some things, now is the time to increase it; is your estate plan in place to address what happens to your estate and beneficiaries? Put money aside for the unexpected. Preparing now means you won't pay later.
Keep planning and don’t relent on always making tough choices especially when it concerns your life, loved ones and finances.