You probably will have to work for the rest of your healthy life. The problem of living too long is increasing exponentially at such a fast rate as we keep on improving health care technologies and focusing more and more on healthy living. This means that we need more money to maintain our lifestyles for longer.
At some stage of your life, sooner than later, you should be working because you want to and not because you have to.
There are two areas of your life that need to be in check to support you in maintaining your lifestyle: Health and wealth.
So your investment strategy should take on a two prong approach:
1. Saving as much as possible for as long as possible. The returns on your savings should be reinvested to take full advantage of compound interest. The magical formula for financial success. You want to arrive at a point where your investments can produce enough income for you to live on for the rest of your life. The earlier you start the less it takes, thanks to the magic of compounding.
2. Investing in your health. Yes, following a healthy lifestyle of diet and exercise can improve your Financial Planning. If you maintain a healthy lifestyle you will benefit from being able to enjoy your financial independence. You will be empowered to occupy yourself with things that you really want to do. If what you do is income producing you can continue to save for a longer time being less dependent on your capital and allowing it to grow for longer.
Once your health fails and you cannot carry on any longer you will then need to depend on your investments. The provisions you have then accumulated will be that much more and won’t need to provide for as long.
Paul Roelofse, Certified Financial Planner® presents 'Financial Fitness' on Radio 702 and Cape Talk on Weekend Breakfast with Africa Melane and Azania Mosaka on Sundays just after 08h00. Visithttp://www.investforlife.co.za/ for more.