How to provide for your old age and live not only on retirement

1. Calculate how much money you need for a comfortable life

To make the idea of saving money for retirement seem stupid now, look at these numbers.

According to the Indexation of Pensions 2018 of the Pension Fund, in 2018 the average pension in Russia was slightly more than 14 thousand rubles. For pensioners without work experience - about 8 thousand.

According to the forecast Demographic forecast until 2035 of Rosstat for 2035, the average life expectancy in our country will be from 74 to 82 years and will only grow further. Now in Russia, men retire at 60 and women at 55. Since 2019, the government plans to step by step increase the retirement age so that men retire at 65 by 2028, and women at 63 by 2034.

This means that after retirement, you will need to live on your own funds for another 20 years. The state benefits are unlikely to be enough to make these years comfortable. It makes sense to take care of a comfortable old age now that you are young and able to work.

To understand how much you need to save, look at your monthly spending on food, rent, transportation, medical care, and recreation. Calculate the approximate amount you need to save now in order to spend the same in old age. Throw in 10% over this amount - inflation is unpredictable, but this way you can at least take into account the inevitable increase in the cost of living.

Example: you are now 25 years old. You will retire at 60, and the state will pay you 14 thousand rubles. For a comfortable life, you need at least 30 thousand rubles a month, that is, 16 thousand more. For a year, this difference will result in 192 thousand, which means that for all 20 years of retirement you need 3 million 840 thousand rubles in addition. You have 35 years to collect this amount. This means you need to save 109 thousand every year or 9 100 rubles every month.

The later you start saving, the larger your monthly pension contribution should be.

30 years old: 128,000 rubles a year, 10,600 a month.
35 years old: 153,600 rubles per year, 12,800 per month.
40 years old: 192,000 rubles a year, 16,000 a month.
45 years old: 256,000 rubles a year, 21,300 a month.

So that savings do not lie dead weight until old age, but bring passive income, you need to properly dispose of them. Come on October 3rd for a free lecture “How to make money in retirement”. Financial advisor Natalya Smirnova will teach you how to save money wisely and share tools to increase income.

2. Invest in yourself

At the beginning of your career, it is better to spend money on self-development and education in order to raise your value as a specialist, and only after that you put aside part of the budget in the pension reserve.

Investment in yourself that will pay off

Learning foreign languages. Don't skimp on language courses and take part in internships abroad. Employees with knowledge of English receive How the knowledge of the English language affects the salary up to 20 thousand rubles more, depending on the level. A second foreign language raises how knowledge of foreign languages affects salary expectations by another 8–48%.
Mastering new professions. Watch how the market changes and improve your qualifications in specialized courses. For example, if you are a financier, study the cryptocurrency markets and become a blockchain specialist: according to recent research from the Global Blockchain Benchmarking Study, Cambridge Center for Alternative Finance, 57% of large banks around the world already conduct transactions using this technology.
Improving personal efficiency. Work on the skills that will make you as productive as possible: time management, speed reading, personal finance management. This is not taught at the university, so do not skimp on professional literature, workshops and lectures in these areas.

3. Don't store money under the mattress

To make your savings profitable, put them in a bank at interest. The amount of income will depend on the interest rate. Now Russian banks are ready to pay an average of 4-7% per annum. The rate depends on the amount and term of the deposit: the less savings and the shorter the term, the lower the percentage of profit will be.

All deposits up to 1, 4 million rubles are insured by the state. It is better to divide a large amount into several deposits and place in different banks.

Example: you have 500,000 rubles and you open a deposit at 5% per annum. In a year he will bring you 25,000 rubles.

An additional 2 thousand a month will not make you an oligarch, but will reduce the impact of inflation. In addition, you will not keep money in your sock, gradually letting it go to unnecessary things. Do not forget to check the current interest rates on deposits and transfer funds to more profitable deposits in time. The Financial Culture website has a convenient calculator for calculating interest on a deposit. You can compare the profit from investments in different banks with it.

4. Invest

The simplest types of investments are to lend money to a company or the government and then repay the debt with interest, or acquire a stake in the business and receive your share of the income. Choose the most predictable and stable options, not potential mountains of gold: if the company in which you invested goes bankrupt, the money will not be returned. The risk is lowest when investing in government bonds, preferred shares and shares of investment funds with a high rating.

Bond - IOU of the state or company. Buying a bond, you lend a certain amount, which is returned within a specified time with interest. The most reliable debt securities are issued by the Ministry of Finance of Russia - they are called federal loan bonds (OFZ).

Example: you buy OFZs with a par value of 1,000 rubles for a period of three years and a yield of 8.5% per annum. In three years, each bond will bring you about 255 rubles. An investment in OFZ in the amount of 100,000 rubles will turn into 125,000.

Stock - a security that makes you a co-owner of the company. By buying even a tiny share of the company, you are entitled to a portion of its profits - dividends. Pay attention to preferred shares: they provide almost guaranteed fixed income.

Example: you have purchased 1,000 shares of a company where the dividend per preferred share is RUB 12. You will receive 12,000 rubles in dividends per year.

Mutual investment fund (UIF) - you transfer money to the company, and it invests it in the best way along with the investments of other members of the mutual fund. You can invest a little, even 1,000 rubles. Pay attention to the credit rating of the company: the letter "A" indicates a high level of reliability, "B" - medium, "C" - the company is on the verge of bankruptcy.

Example: The profitability of a mutual fund, whose management company has an A ++ rating, is 13.25% per year. You invest 50,000 rubles and in a year you take 56,625 rubles.

5. Make money from your creativity

Books, films, illustrations, games and other intellectual products earn royalties for their creators. If the collection of stories you write is in demand, you can earn income from it throughout your life. The main thing is to immediately patent the invention or secure authorship, and then independently or through an agent to sell your developments. The simplest example is photo stocks. By posting your photos on stocks, you can sell them countless times.

These basic tips will help you get started financially preparing for retirement. To learn about all the ways to provide yourself with prosperity in old age, come to the lecture "How to make money in retirement." It's free, but you need to register.