How to have financial independence starting at age 40 – 09/13/2023 – Market

Time is a valuable asset and, when it comes to retirement, it is an irrecoverable resource. For those who have never planned and reached the age of 40 without a pension strategy, now is the time to align your goals with reality and start doing the math.

It is important to keep in mind that the INSS (National Social Security Institute) ceiling is currently set at R$7,507.49 per month. Therefore, if an individual wants to maintain a higher standard of living, similar to what they had before retirement, it is necessary to calculate how much they still have to accumulate until the day they decide to stop working.

More than ever, it is necessary to establish priorities and, if necessary, lower the standard of living now and save what is necessary to enjoy a comfortable retirement in the future.

“This person will have to make two adjustments: expectations and the monthly, semi-annual or annual amount that they will set aside. Because our best friend is time. Time, within financial planning, cannot be adjusted”, says the financial planner Daiane Mohr, from Warren Investimentos.

“If a person is 40 years old and hasn’t planned yet, it doesn’t mean they won’t achieve their goals. But, depending on expectations, it will take a little more monthly sacrifice, because they will have to set aside a larger amount, and eventually You will also have to adjust future expectations”, he adds.

Of course, the need for savings will depend on a series of factors, such as the percentage of income from financial investments, real interest, goals and objectives for the future, among other factors. But more conservative simulations carried out by XP indicate that, on average, while a 20-year-old needs to save around R$1,000 per month to have an extra income of R$3,000 in retirement, a 40-year-old individual must save monthly double that, that is, approximately R$2,000.

But don’t worry, it’s never too late, and it’s always better to think about this issue now than to wait until you retire. “It’s no use, you’ll need to stop for an hour and look at financial education and understand what you lost along the way. If the person gets organized beforehand, they can adjust expenses, sell some assets and build others. In other words, there are always alternatives “, highlights Clara Sodré, Allocation and Funds analyst at XP.

Investment advisor Marcio Bandeira, from Guide, adds that people need to keep in mind that, if there has not been any planning yet, that person will probably have to work for a longer period of time to achieve their goals in retirement. The alternative would be to review your expectations and settle for a lower income.

He also highlights that, in the case of those who have already accumulated some wealth, it is important to choose forms of investment that protect it. In other words, at this stage of life you need to considerably reduce your exposure to riskier investments, such as shares or variable income funds.

and migrate to safer alternatives, such as fixed income securities

and private pension. “You can’t put your assets at risk at this stage of life,” she says.

In the case of private pensions, Danilo Carrillo, a pension and insurance specialist at Warren, advises people to research the different products that exist today to find the one that brings the most advantages, with a higher return and lower maintenance and redemption fees.

“With the emergence of independent insurance companies and managers, this private pension industry has transformed,” says Carillo.

According to the expert, nowadays there are pension products at the same level as non-pension funds, with very similar performance and with the most diverse strategies possible, suited to the investor’s profile and objectives. There are even funds with succession plans, so that heirs can redeem the money without having to pay ITCMD (death and donation transfer tax). RECOMMENDED WALLETS A

Sheet

carried out a survey with three brokers on recommended investments for retirement in the 40s. The investor profile

adopted was the moderate one. It is worth noting that these investment portfolios

They are just guidelines, but it is always important to consult a specialist, who will put together a plan that fits exactly with your profile and personal goals for the future. PROS AND CONS OF AGE GROUP

Benefits:

Higher income; wealth accumulation Disadvantages:

Less time to save; more financial responsibilities Glossary

Investment portfolio: Set of all a person’s financial investments.

Fixed income:

These are applications that have pre-defined income criteria, that is, what are the ways of correcting the invested security, the time limit for the money to be invested and the minimum that needs to be invested. Variable income:

These are investments with less predictability and are therefore considered more risky. They are more subject to market fluctuations, such as interest rates, exchange rates and commodity prices. On the other hand, precisely because they are more risky, they are applications with expectations of higher returns. Investor Profiles

– Conservative: With a low risk tolerance, they look for safer assets to invest in, with greater guarantees of return, even if profitability is lower.