Retirement and Estate Planning remain key to generational wealth.

September 08, 2023

As seen In The Gleaner


For many Jamaicans the notion of gaining wealth is an ideal that is a focus whether through entrepreneurship or employment. However, without proper planning, that could easily take a turn, leaving older persons with no income or resources. 


Shamar Clarke, Executive Financial Advisor at Sagicor Life notes that “retirement planning and estate planning are two interconnected aspects of financial management. Once persons are earning an income they must prioritize securing their future, and that of their loved ones. Both retirement planning and estate planning play crucial roles in ensuring financial stability, preserving assets, and maintaining the quality of life that a person wants during retirement and beyond.”


Pension planning experts such as Clarkeindicate that retirement planning involves setting goals, saving systematically, and investing wisely to build a nest egg that can support the lifestyle after a person stops working. It is essential for each person to start retirement planning early in order to take advantage of the power of compounding and allow their investments to grow steadily over time. Having a clear retirement plan in place, persons can estimate how much money they will need to cover living expenses, healthcare costs, and other financial obligations during their golden years.


Retirement planning can provide financial independence and security after the end of an active income generating career. In most countries, government pension systems generally cover basic living expenses, however relying solely on this source may not be sufficient to meet all retirement needs. By saving diligently and creating a diverse investment portfolio, individuals can have peace of mind knowing that they have built a financial cushion to support their desired lifestyle and pursue their dreams during retirement.


Estate planning, on the other hand, is the process of arranging for the disposal of one's assets and investments after their death. It involves creating a will, establishing trusts, and designating beneficiaries for various assets. Estate planning ensures that a person’s wishes are honoured so that their assets are distributed according to their desires. Clarke noted that, “unfortunately, not many people think of or plan for their own death. But it is an important part of the financial cycle, to make that all the debts and expenses are covered and that your loved ones are clear on how you want your assets to be transferred.”


One of the primary benefits of estate planning is that it minimizes disputes and legal battles after death. Estate planning also allows individuals to protect their assets from excessive estate taxes and ensure that their beneficiaries receive the maximum value from their estate.


Moreover, estate planning enables individuals to choose guardians for their minor children, establish provisions for dependents with special needs, and set up charitable donations to support causes that are important to them. Estate planning is not just for the wealthy; it is a necessary step for individuals of all income levels to safeguard their assets, protect their loved ones, and leave a lasting legacy.


Both retirement planning and estate planning are crucial components of a comprehensive financial plan,” Clarkere-iterated, “retirement planning ensures that individuals can enjoy financial independence and maintain their desired lifestyle during their golden years. Estate planning, on the other hand, allows individuals to preserve and protect their assets, minimize family disputes, and secure their beneficiaries' future. By prioritizing both retirement planning and estate planning, individuals can achieve long-term financial security, peace of mind, and leave a legacy for their loved ones.”