Retirement Pillars: how to diversify your retirement savings
‘My house is my pension’
‘My business is my pension’
‘I will get full State Pension’
‘I am enrolled in a work pension scheme’
These are some common statements we hear regarding retirement planning. Previous generations relied on guaranteed work pensions, well-funded Social Security benefits and increasing property prices. It’s worth remembering that life expectancy was lower at this time, and some might argue that cost of living was reasonable. Equally, there was great sense of urgency and people thought that if you invest wisely in property, or saved enough, you would be fine.
The retirement scene has changed drastically in the last couple of decades, such that relying on just your house or savings account might not be enough to support your retirement years. A smart strategy could be to diversify into various options to achieve your required income.
Various pillars in retirement can come in different forms, as shown in the diagram above.
- Business