Things to consider if your partner has no retirement provision

A harsh truth facing many South Africans is that they haven’t saved enough. But what do you do if you find out your partner has no retirement savings? Annalise De Meillon-Muller, Manager: Distribution & Sales Support at Glacier by Sanlam, provides guidelines to help you make the best of this situation and protect your relationship from money stress in the long term.

Act immediately

The severity of the situation requires sitting your partner down for an honest conversation as soon as possible. This could be a very difficult conversation, and having a financial adviser share facts and figures about life expectancy and budget planning could assist you in navigating the emotional aspects by looking at them from a practical planning and action perspective. 

Save more

Look at your own retirement savings and lifestyle. It’s said that in general lifestyle costs during retirement should be only about 75% of what they were prior to retirement. But if your savings will need to support both you and your partner, it may make sense to cut your lifestyle costs sooner rather than later. 

Scale down

If you were thinking of scaling down your family home, vehicles or other luxury assets for retirement, it may be necessary to do so now in order to generate a lump sum that will help your retirement savings. 

Your retirement date

At the same time, consider your retirement date and whether it is possible to postpone it to allow some additional time for saving. Your partner’s own retirement date should also be considered seriously and staggering your retirement dates could help a lot to ensure the maximum possible additional savings at this time. 

Additional income plans

It’s time to start thinking about how you can generate an additional income during retirement. Have a conversation with your partner about whether he or she can also generate income during retirement in some way. 

Your retirement income planning    

Retirement fund savings in South Africa are regulated by law and two thirds of the value of your retirement savings in the fund must be used to purchase an income solution. 

Retirement income stream management is going to be of the utmost importance and now is the time to talk to your financial adviser about what you need to consider and what is available to maximise the savings you have. 

The market offers a wide variety of solutions, but consider combining different ones to meet your requirements. For example, consider a guaranteed retirement income solution that secures medical scheme contributions, along with a more flexible market-related income solution for lifestyle income. 

The basics will count now 

Retirement planning doesn’t stop on your retirement date. Post-retirement planning is just as important, and you could continue saving after retirement and then apply the savings towards an income at various intervals during your golden years. 

Glacier Financial Solutions (Pty) Ltd and Sanlam Life Insurance Ltd are licensed financial services providers.

Things to consider if your partner has no retirement provision
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