What do you see when you dream about your retirement years? A house with a sea view? Lazy days on the golf course? Your adorable grandchildren underfoot as you trim the rosebushes?

Unfortunately recent statistics from the Pensions Autority show that many Irish will not be able to make these dreams come true because their retirement savings will leave them very short of cash. But the good news is that the very simple calculation, below, that you can use while saving to work out whether you will be able to maintain your lifestyle in your golden years.

THE CALCULATION:

* after working for 5 years, you will need to have saved 1 x your annual salary
* after 10 years, 2 x annual salary
* after 15 years, 3 x annual salary
* after 20 years, 4 x annual salary
* after 25 years, 6 x annual salary
* after 30 years, 7 x annual salary
* after 35 years, 10 x annual salary
* after 40 years, 12 x annual salary

The beauty of the calculation is that it can be applied with very little sophistocated math or financial knowledge.

All you need is an updated retirement savings lump sum and your annual salary figure, the calculation couldn't be simpler. Ideally individuals will use the calculation throughout their working lives, starting from their very first year of employment. But for those who have started saving later, it is still a useful tool and will give a clear indication if they are falling short - they can then try to make a plan to increase the savings as a priority.

Please be cognisant that the calculation is based on what is saved through traditional retirement vehicles and does not include other investments such as property etc.

A few noteworthy tips to consider:-

WORKING FOR 0 TO 5 YEARS

How you start is a good idicator of how you'll end up. So start saving for retirement from your very 1st salary. Saving easily becomes a habit as we all know, it's harder to replace bad habits than good ones. If you are wondering where to start, it is always good to consult a trusted financial advisor. And be sure to take your work pension very seriously.

At 5 years
After 5 years of retirement saving, your interest starts compunding, definfed by Investopedia as "the ability of an asset to generate earnings, which are then reinvested in order to generate their own earnings. In other words, compounding refers to generating earnings from previous earning". Albert Einstein called compounding the 8th wonder of the world!

At 20 years
You have reached the halfway mark of your formal working years and it is well worth taking a very deep look at both your retirement savings and your full financial picture to ensure you are on track for a prosperous happy retirement.

At 30 to 35 years
Now is the time to review how your retirement savings are invested and to start thinking about what type of retirement options you would like to purchase at retirement i.e. purchase an Annuity or follow the Approved Retirement Fund (ARF) route.

At 40 years
Most of us will be thinking of retirement around about now. Your next very important financial decision is how and where to reinvest your retirement savings so that you are able to maintain your lifestyle. Whatever you decide you need to consults a trusted financial advisor who will guide you through the best option which meets your needs and requirements.

You must engage your advisor early and don't be afraid to challenge them and ensure they have really shopped around for the product which suits you best. After all, your days exploring The Wild Atlantic Way or lunching in the clubhouse after your round of golf depend on it!

Talk to Alasdair today to assist you to plan your retirement nest egg and future financial goals. Can you afford to leave your investment strategy to chance? Please complete the attached enquiry form or contact Alasdair directly on 01-8101912 or viainfo@agsfinancial.ie.