Financially, what’s the best way to prepare for a healthy retirement?
With great recruitment comes great success. The obvious reward is the immediate sense of gratification felt when you find a great candidate the perfect role.
Beyond this, there’s the financial gain that comes with it.
Recruitment is an industry that doesn’t require any particular qualification, and with great training and perseverance, anyone can reap the rewards. Successful recruiters can earn overwhelming amounts of money early on in their careers; so much so that it can be difficult knowing how to spend it.
Today, we’ll explore one option that will definitely stand you in good stead for the future.
Perhaps you’ve finally realised the ‘you only live once’ attitude isn’t a sustainable motto to live by, and you’ve succumbed to the idea that preparing yourself financially for later life might be for the best.
But when should you start? And what’s the best way to go about it?
Retirement may seem like an eternity away, but the truth is no matter what age you are it’s never too early to start planning for it. In the wise words of my grandfather… well… he couldn’t remember the exact phrase.
Anyway, let’s have a look at some of the most popular ways of growing your nest egg:
Saving cash in a pension scheme:
● Saving your money in a pension scheme is by far the most popular choice. Pensions are popular because of the level of security they offer; they are deemed to be very low risk.
● What’s more, any approved pension scheme usually offers some degree of tax relief.
● Reassuringly, and perhaps best of all, your savings are kept out of arm's-reach until after a certain age, meaning there’s no chance of blowing them on a mid-life-crisis-induced round the world boating expedition.
● It’s also nice to know that if you die before a certain age and you haven’t spent your savings, they can usually be passed onto loved ones in the form of a tax-free cash sum.
Investing money in stocks:
● Investing in stocks is thought to be riskier than saving in a pension scheme. Whilst this is undoubtedly true in the short-term, stock prices tend to be less volatile in the long-term, and with the correct financial advice you can grow your nest egg substantially more through investment in stocks.
● Having said this, it’s certainly not unheard of for people to lose their life’s savings on the stock market.
● By investing in stocks you’re technically gaining a small percentage of ownership in a company. This means the better a company does, the greater your payout will be. Many serious investors like to buy cheap stocks in small startups in the hope that these companies will go on to be successful. However, this carries a greater risk. For retirement purposes it’s wiser to invest in companies with proven track records that are unlikely to go bust.
Investing money in bonds:
● While stocks represent an ownership interest in a company, bonds are essentially fancy IOUs. Instead of being paid dividends, bondholders are paid interest on their investment.
● Generally, investing in bonds returns less money long-term than investing in stocks. They are, however, considered less risky during short-term periods, meaning less hair-raising moments.
The key - diversifying the risks:
Spreading money across different types of savings and investments is a way of building a strong retirement portfolio. By not putting all of your eggs in one basket, you reduce the risk involved.
Along with an approved, personalised pension plan, investing in stocks is essential in generating enough money to allow you to live a comfortable retirement. However, Given the potential volatility of stocks, it’s essential to supplement these investments with investments in bonds. This allows you to capitalise on the long-term benefits of stocks whilst enjoying the relative stability of bonds during stock market downturns.
The earlier you start putting your money to one side, the more chance you have of generating wealth in the long-term. Establishing your own personal goals is at the heart of planning successfully for retirement, so consulting financial advisors needs to be a part of that. By failing to prepare, you are preparing to fail, and that couldn’t be truer when it comes to retirement. Perhaps that’s the phrase my grandfather was struggling to recall...
Anyway, if you are a Maintenance Engineer looking for a career move in Food & Drink please contact me on 0161 832 1378 or you can send me an email to Christophertalbot@coretalent.co.uk
Please note, I do not provide personal investment advice and I am not a qualified licensed investment advisor. All information found here in this blog, including any ideas, opinions, views, predictions, forecasts, commentaries, suggestions, stock picks, words of wisdom, expressed or implied are for entertainment purposes only and should not be construed as personal investment advice!!