Forget boring pensions and even the idea of retirement, if you’re young you should be working towards ‘salary independence’.
Salary dependent is the point in your life where you are working and your day-to-day life is paid for by the money you earn, whilst you are salary independent when the money you have saved ‘pays’ your income.
By working towards ‘salary independence’ the idea is that individuals can set their own horizons. Saving for income in the future is something that you need to take control of. If you want to work longer that is your choice. While in work you are salary dependent and whether you choose to work from age 18 to 85 or from 25 to 45, it’s up to you.
Individuals can plan their own financial destiny and determine their ‘salary independent’ date to their choosing, rather than be tied to when they receive their pension
Younger people appear to be disengaged from the process of saving due to the ‘confusing’ nature of pensions and the fact they set an arbitrary date on when to stop working.
You don’t need to be an investment expert or a millionaire to reach financial independence; you just need the discipline to save regularly and a long-term time horizon.
By seeking sound, professional advice a longer-term plan can be implemented and regularly reviewed to make sure you are on track for your own needs and objectives.
For many people the idea of saving seems difficult, and perhaps as a society we need to rethink our approach to financial affairs.
While it takes one minute to buy an item online, just several minutes to apply for a credit card, and first-time buyers and borrowers are enticed with a never-ending stream of deals there is no such thing as a first-time saver.
To discuss more, Citrus Financial are a local, highly regarded, independent financial advisors.