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The importance of retirement planning

By Jozef Spiteri - Topics: Malta, Pensions in Malta, Retirement
This article is published on: 1st March 2022

We are living in a world characterised by innovation in all fields, especially in medicine and healthcare. This vast improvement, the fruit of research and technological development which is ongoing, has contributed to a substantial increase in our life expectancy.

Since people are living longer, it is vital that the funds they build up throughout their working lives will be sufficient for them to live comfortably long into retirement.

Life expectancy for women currently stands between 80 and 83 years, whilst that for men is between 75 and 78 years, far greater than even 10 to 20 years ago, and this will continue to increase as developments in the medical sector continue. With the current retirement age standing at 65, this means that individuals must have enough savings to last for 10 to 15 years, and most likely these funds have to last even longer.

Another point to take into consideration is the lifestyle one wishes to lead when retiring and the other costs which come along with old age, such as medical and care costs. Taking these points into consideration, you may be wondering about the the best course of action to create enough wealth to cover your needs and desires in retirement.

The best way to start is to ensure that you do not keep funds in a bank account . Whilst having a cash reserve set aside is important for any emergencies which could arise, having excess funds sitting idle is a killer to the real value of that money (as in our previous article about protecting your wealth). As inflation continues to increase, the value of money earning low interest rates in savings accounts is declining, and this is why something should be done to counteract this issue.

retirement in Malta

One possible solution is investing these funds in a diversified portfolio of assets which, in the long run, will produce a return higher than inflation rates (read our article on investment performance here). This will not only protect your hard-earned cash, but it will add value to it, with the aim of providing financial security later in life and to allow, if you’re so inclined, numerous holidays around the world (or to other planets, who knows) after you retire.

Our advisers will be able to give you personalised, informed advice, to find the best possible solution for your circumstances. The service will be ongoing and adjustments can be made as your situation changes. This is something we are proud of, making sure that we are there for all our clients throughout their investment journey. All initial consultations are free of charge and carry no obligation to proceed.

Article by Jozef Spiteri

If you are based in Malta you can contact Jozef at: jozef.spiteri@spectrum-ifa.com for more information. If you are based in another area within Europe, please complete the form below and we will put a local adviser in touch with you.

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