Here's Why Singles Need To Start Thinking About Retirement Planning Early!
We often think of retirement planning as something that needs to be done only by those who have families to provide for. If you are single and young, you may feel that it is too early to start planning for the golden years. In fact, the sooner you start, the better it is.
Many may not realise, but things can change over the years and can interfere with your ability to keep aside funds for the later years.
The cost of living will rise
Inflation can see the prices of goods and services rise considerably over the years. Things may not cost the same when you are in your 50s as they did in your 20s. The costlier things get, the harder it may be for you to build your savings. So, it is prudent to start thinking about retirement planning when you are still single (and as early as you can).
Easier on the pocket
Starting your retirement planning earlier will make things easier on the pocket. It is wiser to set aside smaller sums of money over a longer period of time when you are in your 20s. Keeping aside larger sums over a shorter period when you are already in your 40s or 50s may be much harder. Plus, the power of compounding interest over several decades will give you the potential of higher returns.
Your expenses may increase
It is quite natural for your expenses to increase as the years roll by. You may buy a car or even purchase a home for your family. It will then get more challenging to keep money aside each month. It would be wise to save up now when you have fewer expenses on your shoulders.
You may start a family or have a change in life direction
When you get married and have children of your own, putting aside money will get harder. Consider the fact that you may be paying not just for your own expenses but also for the expenses of your spouse and children. It may help to start your retirement planning before these important responsibilities in life crop up. That way, you will be financially prepared to a great extent when you decide to have a family of your own. Alternatively, you may choose to take a break from work to pursue your passions and interests, or even plan to start your own business. Give yourself the flexibility by starting to plan for future possible interests.
Retirement insurance savings plan – create a corpus for the golden years
A retirement insurance savings plan can prove to be the perfect addition to your retirement planning portfolio.
Wondering how this plan works?
You either pay a single lump sum premium or smaller premiums that are spread out over several years. Once the plan reaches the payout age selected by you, you receive payouts from the insurance provider. A good insurer will offer flexibility in the premium term and also guarantee that your monthly income will never decrease when the payout period begins. In fact, the payouts have the potential to even increase.
If you do not need your money immediately when reaching the payout age, you can sometimes opt to leave the payouts with the insurer to further grow your funds.
You can also opt to enhance your retirement savings plan with supplementary benefits – just like you would with life insurance. You may want to consider opting for supplementary benefits that waive premiums if you are diagnosed with any of the insurer’s listed critical illnesses or intermediate/early stage medical conditions.
You can also opt for a joint ownership retirement savings plan so that your spouse can succeed you in receiving the plan’s benefits if you pass away.
Do speak to a Prudential Financial Consultant for further help in selecting an insurance plan suited to your retirement needs.
We wish you good luck for your retirement planning.
This article is for your information only and does not consider your specific investment objectives, financial situation or needs. We recommend that you seek advice from a Prudential Singapore Financial Consultant before making a commitment to purchase a policy.
As buying a life insurance policy is a long-term commitment, an early termination of the policy usually involves high costs and the surrender value, if any, that is payable to you may be zero or less than the total premiums paid.
Premiums are not guaranteed and may be adjusted based on future claims experience.
The information contained on this article is intended to be valid in Singapore only and shall not be construed as an offer to sell or solicitation to buy or provision of any insurance product outside Singapore.
These policies are protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact your insurer or visit the GIA/LIA or SDIC websites (www.gia.org.sg or www.lia.org.sg or www.sdic.org.sg).
Information is correct as at 31 May 2021.
This advertisement has not been reviewed by the Monetary Authority of Singapore.