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The five financial steps you must take in your golden years

Make the decision about the best at-retirement investments for your needs.
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People have different views about getting older. For some, reaching their sixties is a difficult moment as they find themselves unable to do some of the things they could in their youth. For others, their sixties are an exciting period filled with new opportunities, fewer responsibilities, and all the time they need to do the things they want.

But irrespective of the differences in how we view our sixties, the one thing that we all have in common is a need to take stock of our financial situation. And that’s especially true of our retirement and estate plans.

Here are five financial planning steps everyone should take when they reach sixty:

  • Make the decision about the best at-retirement investments for your needs

If you haven’t yet reached retirement age, now is the time to think very carefully about how to invest the retirement savings you’ve worked so hard to accumulate. Here, too, it’s essential that you think about more than just your own income needs when you’ve retired, but also what the best solutions are to cover the needs of those you will leave behind if you die. Careful consideration on the differences between living and life annuities is just one example of this type of thinking. A living annuity allows you to leave your invested capital to beneficiaries when you die, but a life annuity doesn’t.

So, while the idea of a guaranteed income for life from a life annuity may seem very appealing to you, a living annuity may better suit your beneficiaries. Alternatively, you may need to sacrifice some of your annuity income to add a second life to the annuity so that your partner isn’t left with nothing if you pass away. These are the types of considerations that are essential when planning for retirement.

  • Make healthcare a priority

 For the vast majority of retirees, healthcare cover and medical costs are the largest expense. Ironically, these costs are often overlooked by people as they make their retirement plans. It’s important to do very careful projections of what your medical aid premiums and day-to-day costs are likely to be, and how they will grow every year. These high costs are often a bitter pill for people to swallow as they approach retirement, with the result that many of us under-estimate just how much we need to have available to pay for our healthcare as we get older and the likelihood of needing expensive medical treatments and medication increase. It’s vital to be realistic and honest with yourself about medical costs in your future.

  • Speak to an expert about the best way to structure your estate.

Ensure that you have structured your finances carefully to cater for the smooth transfer of your assets to your beneficiaries. This includes, but is not limited to, drawing up a Will It also requires that you carefully assess all your investments, policies and assets, and ensure that they are structured in a way that not only meets your retirement needs but will also optimally benefit your loved ones if you pass away.

  •  Update your Will

You should have a valid and updated Will by the time you reach your golden years, bearing in mind that it costs money to wrap up your financial affairs when you pass away – from executor fees, to capital gains tax and outstanding personal liabilities like bonds and more. Make sure that the executor or beneficiaries have access to enough liquid funds to cover any costs and avoid the stressful period of your estate taking months to get processed after you have passed on.

It is vital to face the realities of dying as you enter your senior years, and revisiting your Will is one of the most important things you should do in your sixties. Check that your document is still relevant to the assets, and people, you may have added to your life over the years, and that it is still a good reflection of your wishes.

The importance of sharing the content and location of your Will with your loved ones. A Will is not some secretive document that nobody should know about. It’s something that will have a potentially massive impact on the lives of the people you care about and, as such, you should be able to openly share its contents with them and explain your thinking behind the instructions you’ve included in it.

  • Make sure you have nominated and updated beneficiaries on all your policies and plans

Many people mistakenly believe that as long as they have a will in place, their loved ones will receive the benefits they want them to. Unfortunately, this is generally not the case. While a will is vital in terms of setting out your desires, the trustees of a retirement fund are duty bound to act in the best interests of your dependants, which means it is imperative that you have updated beneficiaries for your policies and update them regularly if your circumstances change. Failing to update your beneficiaries means that there’s a chance that the payment of benefits could be delayed, or even be made to someone from your past that you no longer want to receive them.

While there are undoubtedly many more steps that can, or need to, be taken to ensure financial wellbeing in your senior years, the five financial steps outlined above are vital, not only to achieve the carefree retirement you desire, but also to secure the future you want for the people you care about.

Samukelo Zwane is head of product at FNB Wealth and Investments and Johan Strydom is head of growth at FNB Fiduciary


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Rather a sobering article, not what I expected when I opened it up to read. All it says is to plan for my eventual death (and use FNB to help your estate to rid itself of a few bob in the form of commissions and fees). To be technically correct, we are all busy dying from the second you are born, but is it really necessary to put it so blatant in one’s face? Surely Life is more than just to prepare for your eventual demise?

Indeed Koos : I now refer to my Living Annuity as a Dying Annuity , as u spend so much effort trying to outlive it !!!
Fortunately I told my Kids years ago not to invest in Pension funds but rather stick to unit trusts .
With them all Emigrating now , this has proved to be sage advice .
As for Crypto,s frankly SARS can take a running leap : They have about as much idea how to monitor this as Our war veterans had of fighting a war.

As articles on Moneyweb tell us nearly every week many private sector employees and the self-employed have insufficient funds for retirement. Promoting this concept that pension investments have to somehow not just provide for one’s retirement but also act as a nest egg for beneficiaries (hence promoting a high commission living annuity) is unhelpful for most.

We could really do with some more creative products available at retirement. Instead of being offered ever more non-risk pooled products, why can I not, for example, buy at age 65 an annuity that would cover may basic needs with CPI inflation from the age of 75 or 80. It can be worth ZERO if I don’t make it to that age and that will help keep the upfront lump sum cost low – particularly in SA with short life expectancies. Then I can use my living annuity and investments to cover me for 10-15 years without all the stress of longevity risk through the best years of my retirement. Such products are available in the US.

I am a pensioner and draw a salary from a Living Annuity. The moment I went on pension I drew more money out of my Living Annuity that was necessary and invested the extra money as if I was going to live forever. Meaning it was not invested in money and bonds but mostly in local equities and equities abroad. I am not sorry I made that decision.
I am so glad I did not take out a life annuity because one feel so alive and vibrant when taking control of your own finances.

End of comments.



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