Question:
I am 47+old and have been investing in retirement annuity in monthly premiums for the last 17 years . Currently contribute R343 per month.I am resigning as an educator and will rely on private pension . How much more additionally do I need to contribute to be able to mmaintain my standard of living expense of R130 000 per month from 2022 when my retirement annuity matures?
Answer:
Jerry, If you are saving R343 per month, but you require an income of R130 000 per month, then you are going to have a problem. We cannot say what your required top-up would be as we don't know how much money you have saved to date and how you plan to invest to your further savings, and what fees you are paying. But if you retired now (ie assuming you were 55 now), and assuming you only need R13 000 pm, you would require about R3m to pay for a guaranteed annuity that will pay you that income, growing annually with inflation. Please use our Retirement Calculator to help you with your financial planning, and to figure how much you need to save over the next seven years, to achieve your goal.
