Will Your Retirement Be Enough? How to Make Sure You're Set for the Future with NRFM

Will Your Retirement Be Enough? How to Make Sure You’re Set for the Future with NRFM

Will your retirement be enough to support you in old age? If you’re thinking about this, you’re not alone. Many people are worried that they won’t have enough money saved up to live comfortably in their golden years.

In this blog post, we will discuss some tips for making sure that your retirement savings are on track. We’ll also offer some advice on how to save more money for the future.

How Much Do I Need to Secure Before I Can Retire?

Various formulas can be used to calculate retirement costs, but they’re all rough estimates. A well-known rule is that you’ll require about 80% of the money you’ll need in retirement.
That percentage is based on the fact that some major expenses will decrease in retirement-commuting costs and retirement plan contributions. However, other costs could increase (vacation trips, for instance, and invariably healthcare).

Many retirees say that their expenses during the first few years do not equate to, but often surpass what they paid during their working years. The reason could be that retirees enjoy more leisure activities and spend more money.

Future expenses aren’t easy to estimate. However, the closer to retirement, the more accurate your estimate will probably be about the amount of money you’ll require to support your current level of living or to support a new one. If you take that figure as a starting point, subtract any costs you think will be eliminated at retirement and add new ones. It will give you an estimate of how much you would need to retire.

How Can I Prepare for a Comfortable Retirement?

  1. Start saving early.

If you’re in your early 20s, the idea of retirement appears far away that it doesn’t feel real. It’s one of the most popular reasons people use for not saving enough for retirement.

You won’t make an enormous amount of money when you begin your career, but you have more time than the richer, older people. With time at your disposal, savings for retirement is an exciting and enjoyable prospect.

  1. Invest wisely.

Many people choose to invest in stocks, which can offer the potential for high returns. However, stocks are also risky and can lose value. If you’re not comfortable investing in stocks, other options include bonds and mutual funds. These options tend to be less risky than stocks, but they also have the potential to provide lower returns.

If you’re worried about having enough money saved for retirement, there are steps to ease your fears. Start saving early and invest wisely to ensure a comfortable retirement. With planning and effort, you can rest assured knowing that you’re prepared for the future.

  1. Secure a Pension Retirement Plan

A pension is a retirement savings plan that provides you with a regular income after you retire. If you have a pension, you (and your employer, if it’s a workplace pension) make regular payments into the plan. When you retire, you start to receive payments from the pension fund.

If you’re worried about having enough money saved for retirement, a pension can give you peace of mind. Pensions provide a guaranteed income for life, so you’ll know exactly how much money you’ll have each month. Be sure to understand how your pension works before you retire so you can make the most of this retirement savings option.

In Ireland, Personal Retirement Savings Account (PRSA) is one of the pension retirement plans that is preferred by the majority.

What is a PRSA?

The Personal Retirement Savings Account (PRSA) is a savings contract for the long term with tax-free tax reliefs that are available to anyone who is under the age of 75. It was created to serve as a tool for pre-retirement allowing people to save their retirement funds flexibly.

PRSA Pension is retirement savings account that you can use when you retire anytime between 60 to 75. You’re entitled to the lump sum of 25% (with your first €200,000 being tax-free, and the following €300,000 taxed according to the standard tax rate currently at 20%).

If you’re not satisfied, you have the option of selecting any of the following:

  1.  ARF (Approved Retirement Fund)  It’s your pension fund, and you must earn a salary each year. Every penny you earn is tax-deductible directly at the source.
  2. PRSA Post-retirement  You may keep the PRSA Pension Retirement benefits post-retirement. PRSA (Vested PRSA). It is similar to the Approved Retirement Fund above.
  3. AnnuityYou can buy a lifetime income from any insurance company. The amount you will receive will be based on your age and long-term interest rates.
  4. A PRSA Taxable PRSA Lump sum  You may also choose to take the balance of your pension subject to taxation as income.

Can I Afford to Take Early Retirement With PRSA?

Under the PRSA arrangement, early retirement from employment is possible at 50. The majority of pension plans in the private sector allow members to retire earlier in certain situations. However, the benefits will likely be less than what you would receive at the normal retirement age.

However, you may have the option to take your benefits as a lump sum rather than an income during your early retirement. If you choose to do this, you’ll need to pay taxes on the lump sum.

When it comes to retirement, you want to make sure that you have enough money saved to support yourself. Several retirement savings options are available with their advantages and disadvantages. Be sure to do your research so you can choose the best for your needs.

How Can I Make My Retirement Income Grow Over Time With PRSA?

There are several ways to make your retirement income grow over time. One way is to start saving early and invest wisely. Another way is to choose a retirement savings option that provides tax-free growth, like a PRSA.

Like other personal pensions, your PRSA is an investment account that provides for your retirement. It means that the value of your PRSA can increase or decrease depending on the performance of your PRSA’s investment funds.

Your PRSA value depends on how much you and your employer contribute and how long you leave the money in the account. The earlier you start saving, the longer your money has to grow.
You can make voluntary contributions to top up your PRSA at any time. These are called Additional Voluntary Contributions (AVCs).

You may also be able to use your AVCs to buy an annuity, which is an insurance product that pays you a regular income for life.

Seek Professional Financial Advice

Making sure you have enough since retirement is critical, but it can be hard to know if you’re on track. One way to know where you stand is to seek professional financial advice.

If you’re looking to begin your Personal Retirement Savings Account, it is important to pick the right company. The NRFM is among the top PRSA providers available in Ireland.
NRFM is one of few providers that offer a full range of self-invested retirement options. NRFM ensures that its customers are up-to-date with the latest pension laws and provides customers with various investment choices.

Newcourt Retirement Fund Managers Limited (NRFM), with its associated Newcourt Pensioneer Trustees Limited, is a specialist in self-invested pensions.

Our products provide flexibility and choices in your pension investment. Our experienced team of administrators ensures that you are always up-to-date, informed on your retirement savings, and ready to help with any questions.

With decades of experience, we can assist you in growing your retirement savings. Call us today and get us involved in helping you plan your retirement.