Planning for your retirement is a process of saving money for use later in life. This means you won’t be forced to rely on handouts from family members or on a state pension.
Let's look at the following scenario . . .
You live until you are 80 years old. You start working when you are 20. You retire when you are 60.
In the 40 years that you work and earn money, you need to save for the 20 years (between 60 and 80) when you will not be working and earning money.
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Planning for your retirement means making sure you have enough money for when you retire, and also deciding how you want that money paid to you during your retirement.
You have to commit to save a small amount of your income each month. The earlier in life you begin to save, the more money you will have. Making sure that your money grows faster than inflation is smart because inflation decreases the value of your money.
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