A very close determinant to retiring rich is to be born rich. If you’re not, please pay very close attention to this article.
About 90% of Nigerians aged 60 years and above are living with an irregular pension or without any pension support.
Retiring rich is a goal many people have but only a few know what it really involves and work towards it. And except you are hoping to retire rich on vibes alone, here is what you need to know on how to retire rich.
8 Ways to Retire Rich
1. Have multiple sources of income
Having a source of income is the first and most important step on your journey to retiring rich. You need to be able to meet your immediate financial needs first to properly begin to plan for retirement. If possible, have multiple sources of income to ensure that there is money flowing in.
2. Evaluate your lifestyle
The goal of planning for retirement is to be able to sustain a certain lifestyle. Take stock of your current lifestyle and outline your needs. There should be a consistent balance between your income and lifestyle choices. A higher income doesn’t necessarily translate into an upgrade in lifestyle.
3. Live within your means
You have to learn to live on a budget if you intend to retire rich. This helps to cut costs and to avoid unnecessary expenses. If you cannot comfortably afford to pay for your rent, find a cheaper place to live. Don’t get pressured to meet a standard of living you cannot sustain.
4. Start saving early
It’s never too early to start saving for retirement. The best time to start was yesterday, the next best time is now. Have an estimate of what your expenditure would be considering accommodation and maintenance, feeding, transportation, medical bills, etc, and save a percentage of your current income. Don’t forget to factor in inflation costs.
5. Invest in mutual funds
It is not enough to just save. Investing your money in a good investment plan like mutual funds helps you to grow wealth. You are able to save and invest at the same time. This gives you a sense of security as your money compounds over time.
Related: Why Mutual Fund Investing is a Good Idea For Retirement
6. Get financially educated
Financial education is very important. It helps you learn how to manage your money. An easy way to lose money is through bad financial decisions. It is always better to learn and know what to do per time. Follow financial advisors and educational blogs like the Cowrywise blog to learn about finance.
7. Get Health Insurance
Planning for medical care and emergencies is important. Your health is important and you will always have to take care of yourself. Enrol in a health insurance plan to cover your medical expenses when needed.
8. Have an emergency plan
Emergencies are unpredictable. An emergency plan helps you to cover your emergency expenses without spending your savings or going into debt.
Find out more on how to start an emergency savings plan on Cowrywise.
How to Retire Rich FAQs
How much of my salary do I need to retire?
You do not need to save all of your money for retirement. It is advisable though to save at least 10 – 15% of your monthly income.
What age is best to retire?
Although the official retirement age in Nigeria is 65 years, you can choose to retire at any time as long as you are comfortable with your lifestyle and can afford to sustain it.
What is considered retiring rich?
The word “rich” is relative. You can only determine if you are retiring rich or not based on the kind of lifestyle you want and how much you’ve saved up for it.
Bottom Line
Retiring rich can only happen when you plan, save, and invest for it. Do you still want to retire rich? Cowrywise gives you all the tools you need to start planning for your retirement journey. Don’t wait till you are older or approaching retirement. Start investing.
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