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Friday, 10 August 2012

How does a 25 year old save up for retirement and avoid being beaten by the inflation rate?

If you are 25 years old and want to start saving for retirement, you are starting at the perfect time and should realise that financial freedom will certainly be attainable for you. Here are some steps you should follow:
  • Make sure you have no short term debt i.e. credit cards, store cards or personal loans. Rather pay these off first before you start investing any money.
  • Try to save 15% of your total salary every month. So, if you earn R5,000 per month then you should save R750 every month – this includes any savings towards your retirement funds
  •  Given your age ie, 25 you can invest in something that only invests in shares and not in cash or bonds. For smaller amounts ie, between R300 and R900 per month, you should look at a monthly investment in an exchange traded fund (ETF). There are a range of ETFs available to you, you can find out more on www.etfsa.co.za

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