Focus on controllable factors: retirement preparation can be easy
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Most people know that retirement planning is very important, but they think it is too complicated and difficult to implement. Why?

Perfect retirement planning involves many factors, but many people focus too much on the factors they can't grasp, such as the timing of retirement, the government's tax policy, and even the market situation and the rate of return on investment, which leads to their anxiety and lack of sense of direction, and ultimately affects the actual planning effect. Therefore, you must give priority to controllable factors to reduce the difficulty of pension preparation.
Everyone needs to balance saving and spending all his life. Apart from retirement, other needs in your life and long-term expenses of your family are important financial plans in your life (such as children's education, house purchase, overseas travel, long-term study, etc.). Therefore, it is very important for you to choose an asset allocation strategy that can change with time and a financial plan that adapts to the circumstances.
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Prepare as early as possible: make an investment plan and make an appointment for a worry free retirement
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It is not difficult to build a comprehensive retirement plan. The most important thing is to "start early". As long as you set the direction, your retirement plan will lead you to achieve your financial goals and review your progress and effectiveness at any time. Even if the economic environment and your life change, retirement plans can provide relative guidance.
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If you are still some time away from retirement and don't know how to estimate the consumption level after retirement, you can multiply the income before retirement by a proportion to estimate the consumption after retirement. In general, the cost requirement after retirement is lower than that before retirement, because you can save a lot of work-related expenses, or you have paid off the mortgage. So you only need to solve one problem: where does your income come from after retirement? Early investment may be a wise choice.
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Be sure to invest: activate your existing assets
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Although cash can make people feel "at ease", the annual inflation will reduce the purchasing power of cash, so holding too much cash will make it more difficult to cope with the long-term retirement life. In addition, commodity prices tend to rise for a long time. If you continue to hold cash and savings, your assets will shrink.

In the past 15 years, although the interest rate of deposits has slightly exceeded the inflation rate, the rate of return is far less than that of investing part of our wealth in stocks or widely dispersing in stocks and bonds. It is suggested that you use part of the cash to meet the short-term expenses and urgent needs, and match it with a properly allocated long-term portfolio to meet your future financial needs.
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Adjust the strategy according to the goal: set your financial goals at different stages according to the effect of compound interest

Everyone has different financial goals to achieve at different stages. For example: marriage, education, housing, long-term education or retirement. Regardless of your age, you can divide these goals into short, medium and long-term goals.

Please decide how much deposit to allocate to each target according to the priority of each target. Next, make an investment plan for these goals, and make good use of the longer compound interest to save the cost of long-term goals.

I would like to remind you that you must also keep a reserve composed of short-term investment and savings office to meet the emergency expenses and avoid being forced to sell the remaining assets when you suddenly need a large amount of funds in the future.
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Make good use of asset characteristics: mixed investment is most suitable for pension provision

Is the stock really highly volatile? Is bond really low volatility? It depends on the period of your investment.

Although the performance of the market may not be as expected in a certain period, according to historical experience, as long as the investment time is prolonged, stable returns can still be expected. This figure illustrates this concept. Since 1950, the return on stock investment has fluctuated greatly (from + 47% to - 39%); However, in the past 69 years, the rolling returns of the mixed portfolio of stocks and bonds have not been negative for more than five years. In other words, if we diversify investment and continue to hold it, the volatility of the return on investment is low and the return is stable.
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Long term dynamic investment: making the best allocation in response to market changes
The investment risks in life will change with time. Your asset allocation strategy should be dynamic to respond immediately to the most significant current risks.

When you are still some time away from retirement, you are most able to pursue higher growth investment, but at the same time, you will face the risk of unstable savings or interference by other temporary expenditures. As time goes by, you will be more sensitive to market fluctuations and retirement opportunities. Therefore, you need to rely on a long-term dynamic portfolio to provide current income and maintain future growth at the same time.
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Include longevity risk: longevity is both a blessing and a challenge

The longer you live, the longer you need asset support.

Among couples aged 65, one of them is 92% likely to live to 80, and 80% likely to live to 85 or above. If you are healthy at the age of 65 and your family has a long life history, your retirement plan should plan the cost of living for at least 30 years or more.

Longevity is crucial to retirement decision-making. When to retire, how to make good use of your time, how to invest and whether you need long-term care. It also means that your portfolio needs to continue to grow after you retire in order to keep up with inflation and reduce the risk that you will run out of money in your lifetime.
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