Disability insurance
Similarly, to life insurance, disability insurance gives you a safety net or a cushion should something affect your mobility. If an accident at work or at home mean that you are now unable to work, how will you contribute to your retirement fund? The short answer is that you can’t.
Getting insurance to cover more than half of your annual income can provide you that safety net that you need just in case anything bad should happen.
Emergency savings
Rainy day savings aren’t just for cruises and holidays. It’s always recommended to have at least three to six months of savings built up in your savings account.
The reason for this is that it is a substantial amount of money saved in the event that you lose your job. It means that you can keep up with your regular payments for mortgage, rent, groceries and bills, but it also would cover your retirement payments. Without an emergency fund, you could find yourself in a precarious position. Set up regular transfers from your main account to your savings so that you don’t have to even think about the cash that you save up.
Retirement shouldn’t be something to dread. If you haven’t started your planning, it will become something that you fear and that stresses you out, and it’s not what you need.
Your retirement years should be fulfilling and secure. Ideally, you’ve been paying into a mortgage pot your whole life, which means your house is free of payments and entirely your own. If you haven’t had the privilege of building or owning your own home, you have to be creative which is why there are so many other avenues to look at when it comes to your savings.
Preparing for retirement when you are on a budget is also difficult, but this is where your employer can come into it to help you out. You don’t have to think about your retirement fund if you are proactive and on the ball early enough – so all you have to do is make sure that you set things up as early as you can.
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