Retirement income planning

One way to better manage the higher risk of living annuities and the rigidity of guaranteed annuities is to use a blended annuity, a retirement income product that has the best of both in one.

Current regulations require you to use a minimum of two thirds of your retirement fund income to purchase a life annuity or a living annuity, or a combination of both. It's a big choice for retirement! Which one should you choose? 

Fresh uncertainties could have people looking for financial certainty, and there’s some good news for those considering their retirement income options. 

Increased global longevity is giving us more years of active health and possibly a longer retirement. But within current economic and political constraints, how can South Africans approaching retirement make these extra years count for more than just ‘bought time’?

Not all young earners fully understand retirement solutions to make informed savings decisions for their future pension. But faced with increasing longevity and a more active lifestyle during the golden years, this Savings Month Bonolo Mosoane says all South Africans should rather question if they can afford not to save for retirement.

One way to better manage the higher risk of living annuities and the rigidity of guaranteed annuities is to use a blended annuity, a retirement income product that has the best of both in one.

Think about shifting the conversation around the role of beneficiaries in retirement planning. Instead of focusing on leaving money to beneficiaries, rather propose involving those would-be beneficiaries in the decision-making stages of retirement planning. This should help mitigate any unforeseen changes in their role as a beneficiary to that of a provider.

How do you weigh up the pros and cons and make a balanced decision on whether a retirement village is the right move for you? The role and requirements of the 'retirement village' are constantly changing with many establishments modernising their facilities to support the needs of their residents. Do your homework, draw up a realistic budget and most importantly chat to your financial adviser so you're well informed to make the right decision for you and your family/support system.

Now is a good time for retirees to secure a guaranteed income for life. According to retirement income specialist Just, if your retirement savings were invested in balanced funds through the market turmoil of 2020, it is currently possible to secure a guaranteed income for life that is more than 15% higher than it would have been had you invested on 1 January last year.

If your retirement savings were invested in balanced funds through the market turmoil of 2020, there is some good news. You can currently secure a guaranteed income for life that is over 15% higher than it would have been had you invested on 1 January 2020 before the market crash; an income that targets growth in line with inflation.