Do you know how much income you need to earn monthly or the capital you need to have accumulated to be comfortable at retirement? Simply guessing a “big” number may not be the right way to answer this very important question. Very few of us consider how much will be enough when planning for our retirement. To maximize your retirement planning efforts, it is important to have a goal to work towards. This write-up will highlight a number of steps to consider when determining your magic number.

Determine your desired retirement lifestyle and its financial implications.

How much will you need monthly at retirement? The rule of thumb is 70%-80% of your pre-retirement income, however, in Ghana the average retiree is advised to work towards 100% of their pre-retirement income taking into consideration our socio-cultural setting. The appropriate figure is dependent on your unique individual situation. You can do the below to arrive a reasonable figure;

1. Review your current budget to reflect your desired lifestyle at retirement. What expense items would you like to add and which ones would you like to take out.
2. Consider retirement related expenses like healthcare, long term care etc.
3. Take out non-retirement related expenses
4. Consider cost of big ticket items you wish purchase during your retirement
5. Consider inflation

I. When do you plan to retire? 

Do you plan to retire before the official retirement age or after? Retiring before 55yrs means you can’t have access to your retirement benefits under the 3 tiered pensions arrangement unless you are medically incapacitated, unemployed at 50 or an emigrant leaving Ghana for good. If you retire from 55 to 59 year, you will receive relatively lower pension benefits. The maximum monthly pensions you can earn from SSNIT at the mandatory retirement age is 60% of your pre-retirement basic salary. You can generate additional income to bridge the gap from your tier 2 and 3 benefits as well as other investments or passive income streams. The earlier you wish to retire, the more you need to have invested to last your retirement.

 II. How long will your retirement last?

 Improved health care and healthy lifestyles are making it possible to live longer. The longer you live, the more capital you will at retirement to maintain your desired retirement lifestyle.  Also, the older you grow, the more likely you are to spend more on healthcare and long-term care.

 III. Do you want to leave money to your children, family, or charities?

 If your answer to this question, you will need to have excess funds after you are gone. To make this dream a reality, you will have to consider how much you hope to leave when planning your retirement. The more you need to leave, the more capital you will need at retirement.

Not sure about how to go about these assessments and projections? You can seek the expertise of This email address is being protected from spambots. You need JavaScript enabled to view it.. Now that you have your retirement goals, you can put together a plan to achieve your goals taking into consideration your current financial situation.

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Axis Pension Trust partners workers throughout their retirement planning journey to ensure they are on track to achieve a dignified retirement. For more information on our services or general enquiries, send an email to This email address is being protected from spambots. You need JavaScript enabled to view it. or call 030 273 8555.