Imagine for a moment that your life began on 1 July and ended on the 31st – say, 80 years of a life shrunk down to 31 days. What would your savings picture look like then?
In this scenario, you will typically start your first job promptly at 4:30pm on 10 July at the age of 25, after growing up and completing your education. If you are smart you will start saving as soon as your first pay cheque slides into your bank account 47 minutes later: a month in real-time.
But most of us choose to dally. Instead of starting to save at 25 – we wait until 30 (12 July at 3pm), 40 (16 July at midday) or even 50 (20 July at 9am).
It may seem like there is still plenty of time in this hypothetical lifetime – but remember that although we think of 65 as our normal retirement age, employment often ends at 60. So when 24 July rolls around and the steady stream of employment income dries up, the situation begins to look dire; much like when your salary runs out well before the next payday…
An article I wrote for Allan Gray that gives a different perspective on the brevity of your financial life.
Writer Gugulethu Hlekwayo
Editor Daniella Bergman