In terms of retirement savings, when to start ?, although it seems far away it is very important to do so as soon as possible.
Retirement experts warn that since someone has their first job it is necessary to start thinking about retirement. Most Mexicans get their first job at age 20, then thinking about quitting work, at least formally, at age 60, they will have 40 years to save.
Imagine that today you earn 10 thousand pesos a month
And yes, when we say 40 years, it is still thought that much is missing, however, figures from the National Commission of the Retirement Savings System (Consar), estimates that the majority of people who have an Bank account, will only have Pension 30 percent of your last salary, this is known as replacement rate.
Imagine that today you earn 10 thousand pesos a month, when you reach the age to retire can you live with 3 thousand pesos? Surely not, so it is necessary that you start thinking about it today, so you can allocate a portion of your income for this purpose. The earlier you start, the lower the amount you have to allocate.
Making voluntary contributions
The Principal Financial Group made calculations that estimate that people who lack 40 years to retire will only have to voluntarily save 19 percent of their salary to reach a replacement rate of 100 percent.
While a person who is only 5 years away from retirement, but never worried about making voluntary contributions would have to put 265 percent of his salary to reach a 100 percent replacement rate, this is obviously impossible.
Now can you see the importance of starting now? A fundamental part of financial education is that the earlier you think about making this savings, the less you will have to sacrifice. Then it will be more than complicated and you will surely not achieve a replacement rate that fits your needs.
This is the reason why 41 percent of people who should already be retired in Mexico continue to work; They do not have enough resources to pay for their daily expenses. Up to 83 percent of this segment of the population argues that it requires money, according to the Savings and Retirement survey, how do Mexicans live retirement ?, conducted by the Mexican Association of Banks (AmBank).
But why with the money of the Bank is not enough? Tripartite contributions, that is, from the worker, the government and the employer, only represent 6.5 percent of the Basic Contribution Salary, or the salary with which you are registered with your social security institution; a low percentage compared to other countries, where only the holder contributes 8 percent of his salary.
For independent workers, the situation is much more compromising, because since they do not have a employer, the total savings depend on it. Good news is that there are several Banks in which they can register and start saving.
Increase retirement savings are voluntary contributions directly to your Bank
The options to increase retirement savings are voluntary contributions directly to your Bank; Some others opt for personal retirement plans, for example.
But they are not all alternatives, you can also be part of the platforms where people finance people, since the returns they offer are above inflation, such as the Bank model which charges an interest rate from 8.9 percent, to which you would only have to subtract a commission and the rest will be the profit you can allocate to your retirement.
You will choose the option that suits you, the intention is that you deal with it, whatever the way you decide to grow your money, you know the recommendation compares the options and their benefits.
I am going to leave you with a figure that could scare you, however, my only intention is that you take care of your retirement as soon as possible: speaking with a manager of a financial institution he told me that by the time we arrive at the withdrawal in our account we will have to have 10 years of salary to be able to live this stage comfortably, I leave it homework.