Section 4
Secure a sustainable income
Saving for retirement will help save your retirement. Either keep something in reserve or have a guarantee to fall back on. Depending on the amount saved, income options at retirement offer different benefits and outcome.
Annuities provide a steady income during retirement
Applying the theory
Taking an astute couple from our survey into a practical example:
Age 65, and the other is two years younger
Current household income is R15 000 per month
R4,5m saved for retirement
Realistic in terms of income in retirement, knowing this is a modest amount
Still want to only draw R15 000 per month in retirement
Quietly confident that this annuity will cover monthly essential expenses (+/- R8 000) for life, which they think will only be for another 15 years
They do not want to seek advice from a financial adviser
Translates into a living annuity draw down rate of 4%
Applying the theory
And adding some other couples as further examples...
Drawdown rates in relation to age
Safe drawdown rates versus typical guaranteed life annuity rates
Based on life annuity rates which can be obtained from Just Lifetime Income (JuLI) StableGro
How your drawdown maps to an optimal retirement income solution
How your drawdown maps to an optimal retirement income solution
Do you need advice?
It is worth considering advice from a qualified financial adviser...
If you need help understanding your options – life, living and blended annuities
If you want to take account of your personal financial circumstances
If you are considering how your retirement savings can be used with other savings and investments to meet your financial needs
If you need to consider the tax implications of your choices
Contact Just or visit our website for more information, or for details of independent financial advisers in your area