THE WIKI COMMUNITY

Sunday, 29 August 2010

Why A Pension Advisor Is Important When Planning For Your Old Age

By Mark Ferguson

A very large percentage of people reach retirement age without having made proper provision for their old age. As they become older, inflation eats away at their savings. They also have increasing medical experiences. All this can eventually leave them destitute. Below we will explain the importance of using a pension advisor when you are planning for your retirement.

These advisors are as a rule highly knowledgeable about the financial products that are available. He will study your particular situation and goals and then recommend a product or products that are suitable for you. Since he's an outsider he will be emotionally detached and therefore in a much better situation to give you advice from an objective point of view.

The multitude of financial products on the market can be very confusing to a non-financial person. This is why people often make mistakes and place their funds in totally inappropriate investments. You get investments that offer exceptional returns, but they carry a high risk. Then you get ones that offer low risk, but also give you a very low return on your money. You need a professional advisor to steer you through the maze of potential investment options out there.

Something that causes a lot of non-financial people to make serious mistakes in retirement planning is inflation. You need quite sophisticated software to make projections about the influence different levels of inflation is going to have on your retirement funds. Without this, you can very easily under-provide for inflation and end up with a pension that is shrinking in value every month.

The amount you should invest now to provide for your retirement years is determined by a variety of factors. These include the condition of your health, your preferred lifestyle, inflation rates, currency valuations and much more. Only someone with a professional level of knowledge about financial markets can give you proper advice when it comes to this.

As will be clear from the above, it's unwise to approach the minefield of retirement investment without a good pension advisor. He will take a lot of the risk and uncertainty out of the whole exercise. Making use of his experience and knowledge will provide you with peace of mind regarding your retirement.

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