Right behaviour, right outcome

By Vuyolwethu Nogantshi

How often do you really think about your retirement? Do you ever think about the impact of what you do today, or tomorrow, or the next day will have on your ability to continue living in the way you consider comfortable?

More and more, South Africans need to start thinking about their retirement on a daily basis, realising what they can and cannot control. Moreover, a few key insights could mean the difference between rands and cents at retirement.

Focus on what you can control

At the age of 25, your retirement is over 30 years away. Your retirement outcomes are largely characterised by how much you save and, once in retirement, how much you spend.

In order to save, you would need to have some form of earnings with which to save. You do have some control over whether or not you gain some form of employment, the level of earnings you accept and how long you remain employed during your working lifetime.

Meaningful savings only happen when you invest, and you will need to be in control of how much risk you allow in your investments.

Finally, if you want to spend your savings in retirement, you need to be alive to do so. How long you live to spend your savings depends partially on how well you have taken care of your health over your lifetime.

Making the best of your retirement

What is out of your control?

Although your retirement may be some years away, you do need to make sure that you take note of the things that you cannot control.

As much as you may believe that you can time the markets, your investment outcome is largely unpredictable. Time in market using an appropriate investment is more important than trying to manipulate the outcome in advance.

Lastly, you cannot control the rules that apply to your savings before and after retirement.

Retiring well is not a certainty, but retiring is. In planning for this eventuality, remember that there are significant factors that are outside of your control, but you must not forget that you do have a considerable degree of control too.