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Plan for the future

We are living longer than we used to, thanks to improved standards of living and better healthcare. Many people are enjoying longer retirements than they planned for, but that can come with the prospect of not being able to make ends meet in later life.

So the sooner you start saving for retirement, the more you’ll be able to save, and the more comfortable you’ll be.

How much might you need?

Everyone’s situation is different, so there is no single rule to follow that will tell you exactly how much money you'll need for your retirement. It will depend on many factors, including:

  • The age you plan to retire
  • Whether you own your own home
  • The rate of inflation
  • Whether you have debts that you need to manage
  • Your family and number of dependents
  • Whether you plan to continue working, in any capacity, and semi-retire

A good starting point is to assume you will need between half and two-thirds of your salary, after tax is deducted, to maintain your current lifestyle.

Social Security

You may be entitled to social security, but in most cases it will be difficult to live on this alone. You should plan to supplement any social security with savings and investments of your own if you possibly can. Remember, too, that the laws guiding social security may have changed by the time you reach retirement age.

Employer contributions to Retirement Plans

You may find that your employer has elected to contribute toward your retirement plan in proportion to your own contributions, up to a defined amount. It can help to grow your savings significantly, and you may also be entitled to tax relief on the combined amount saved.

When planning for your future, here are three key points to keep in mind:

  1. Start as soon as you can
    The earlier you start saving, the more the interest on your savings will compound, and the longer you will have to save.
  2. Make the most of any tax-free savings and employer contributions you're entitled to.
  3. Build your knowledge
    You might want to seek advice from a professional financial adviser.
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HSBC offers these articles for educational purposes only and they should not be considered professional or investment advice. While HSBC is pleased to offer these articles as an educational service to our customers, HSBC does not guarantee, warrant or recommend the opinion or advice or the product and/or services offered or mentioned in these articles. Any opinions, judgments, advice, statements, services, offers or other information presented within an article are those of a third party and not HSBC. For a comprehensive review of your personal finances, always consult with a tax or legal advisor. Neither HSBC, nor any of its representatives may give legal or tax advice.