Whether you are 10 or 30 years away from retirement, there are at least three worst-case scenarios to avoid so that your retirement years are maximised both financially and personally. They are: inadequate retirement income, inflation erosion and long-term care.

Inadequate retirement income is something that most people endeavour to avoid in principle but in reality don't accomplish during retirement. Many persons have the misguided notion that their State and employment-related benefits, personal savings and investments will be enough to maintain their retirement lifestyle. Inadequate retirement income is directly related to your lifestyle and the expenses to support it. The key to this scenario is to know when to change your lifestyle to meet your income. So, for example, if you live in a five-bedroom house with high maintenance costs, it may be wise to down-size to a two-bedroom apartment and save the money for hotel stays when the children and family visit. There are two benefits: you will be catered to and it will be a family vacation.

Inflation erosion is a factor that also needs to be taken into account during the accumulation phase of your planning. So your financial or life insurance adviser, should be able to provide you with information on how much extra you should be saving to militate inflation erosion of your retirement income.

Here's an example, if you are 40 years old and want to receive 100 per cent of your income at retirement and indexed at 10 per cent, your monthly savings would need to be 38.86 per cent of your gross monthly income and for a male, 49.68 per cent. This should highlight the importance of starting early and knowing your sources of retirement income. The alternative would be to purchase an indexed-annuity at your retirement date.

Long-term care is another scenario that has the financial risks of unforeseen health-care costs. Therefore, it would be wise to take the necessary steps to guard against any of these eventualities - cancer, coma, heart attack, etc. Fortunately, there are now critical illness products offered by life insurance companies which can provide financial assistance for such illnesses. To date, there are no Financial Services Commission-approved financial products which address the financial and residential needs for long-term care. One approach would be to take care of your health today to live a healthier life tomorrow.

The foregoing information is a guide. It's up to you; you no longer have an excuse to not take charge of your retirement financial and lifestyle planning. Start now!

Contact us at info@milestoneslifestyle.com.

It's up to you; you no longer have an excuse not to take charge of your retirement financial and lifestyle planning. Start now!!