Retirement planning involves setting money aside for retirement years.  Income obtained from pension funds is in most cases not enough to take care of all financial needs at retirement. 

Saving for retirement will enable you maintain the same lifestyle that you were used to when you were working.  With a continuous flow of income at retirement it is also possible to pursue activities of interest that were not possible to pursue while working.

To facilitate the retirement planning goal, consider investing in long term investment vehicles.  When savings are still modest consider investing in fixed deposits and then once larger sums have been accumulated move into investment vehicles that require higher minimum amounts such as government securities which is currently at Tshs. 5million in Tanzania.

When young and far from retirement consider focusing on:

1.      High yield investments which are likely to be more risky

2.      Holding investments for long periods of time to advantage and minimize fluctuations in prices

3.      Growth investments that will increase the value of investment with time

4.      Investments such as company shares/stocks and some bonds

When getting close to retirement consider moving funds to:

1.      Less risky investments

2.      Income generating investments

3.      Short term investments

4.      Investments such as bonds/securities and less shares/stocks

During retirement consider finalizing Retirement Planning by:

1.      Gradually moving funds to highly liquid investments

2.      Opting for investments with 100% guarantee of principal

3.      Choosing investments with much shorter maturity and spreading the maturities of investments such that there is a continuous flow of income

4.      Moving to investment vehicles such as short term bonds and Fixed Deposits