Here are five things to keep in check:

 

1. Clear your debts

Debt, if left unchecked, could end up seriously derailing your retirement plans.

In the short term, aim to reduce bad debt or outstanding balances owed that can no longer be recovered. This usually refers to debts with high interest rates such as credit debt.

At the same time, start paring down big loans such as mortgages so that you won’t have to worry about them in retirement.

 

2. Have enough savings

Ensure you have enough savings to cover your expenses when you retire. This might seem straightforward, but systematically tabulating your finances is a foolproof way to know if you’re on top of things.

First, calculate how much you will need each month in your retirement - for both essentials and discretionary expenses - to project how much you need to save. And, take into account future inflation rates which will devalue the amount saved. In Singapore, it is estimated that the average citizen will require at least S$3,000 to cover his or her basic monthly expenses.

Here’s how it could look like:
• Food and transport: S$800
• Healthcare: S$500 for healthcare
• Home maintenance and utilities: S$500
• Travel and other hobbies: $1,200

Total: S$3,000

Source: CPF Board

Of course, how much extra savings one needs would be dependent on specific circumstances. But ensure that you do your sums and aim to save up that desired amount over the course of your career.

Take your CPF payouts into account as well, although that is unlikely to be enough on its own. Use the CPF calculator to estimate how much it will generate for you in your retirement years.

 

3. Have a stable, well-diversified portfolio

When you’re younger, there’s a lot more room to take risks in investing as there’s more time for you to recover from any shortfalls. But as you approach retirement age, safe and steady growth should take priority.

Focus on stable investments and wealth creation by reviewing your portfolios regularly and balance it at an acceptable risk level to achieve your desired rates of return.

To supplement your savings, consider income-generating investments. Maybank’s Enrich Retirement endowment plan, for instance, allows customers to enjoy a monthly retirement income for 10 or 20 years from when they are 60 or 65.

 

4. Be well covered

Health is wealth. So protect yourself by ensuring that your health needs are covered from as early as possible. This will be critical as you move into your golden years.

Singapore’s Medisave provides basic universal coverage, but depending on your own circumstances, you may require different types of coverage. Other insurance options to consider include hospital plans, accident plans, or life plans. It may be worth considering options that offer flexibility and can cater to your needs and wants according to your life circumstances.

Having a coverage plan that is customised to your needs will serve well as a financial safety net in the event of an unexpected illness, so that neither your savings would be depleted nor your family be saddled with huge medical bills.

 

5. Have a positive mindset

Is your glass half-empty or half-full?

A positive mindset means a happy, healthy, and comfortable retirement. Staying connected with friends and meditation can assist with this.

But if you’re having serious doubts about retiring, it could be worth thinking about extending your working life. Staying active and finding purpose in what you do is most important.