How to be an asset and not a liability in retirement



Grace Agada
An asset is a person or tool that produces more income than is needed to maintain it. And a liability is a person or tool that produces income that is less than the cost of maintaining it. Assets add value and create wealth for the beneficiaries of the asset. And liabilities deduct value and create poverty for the beneficiaries of the asset. When you are an asset, you become a problem solver for yourself, your family, and your community. And you participate in the initiation or extension of generational wealth. When you are a disability, you are the problem, and you participate in the initiation or extension of generational poverty. Although it is easy to be an asset during your active professional life. The challenge is to maintain your active status in retirement. Research shows that 80% of working professionals do not maintain their active status, which means more people will become liabilities in retirement than active. Yet being an asset is the only way to maintain your financial dignity, relevance, and respect in retirement. Without help, the transition from active to passive is imminent for many and here’s why.

Only three plans will determine your financial situation in retirement. The first is the government’s plan. The second is your employer plan and the third is your plan.

The government plan is the pension plan. You and your employer contribute to this plan. However, this plan only represents about 20% of your current income. And for those whose pension represents more than 20%, your purchasing power is always threatened. So without a plan to increase the pension, becoming a liability in retirement is almost guaranteed. The only way to avoid this is to increase the pension with additional investments. Yet what most people call investing is building a portfolio of assets that generates more risk, anxiety, and stress than passive income or freedom. There will be more retired investors who become liabilities than non-investors. Not all investments can give you financial freedom, and not all investment strategies can produce the size of stable passive income that can support you in retirement. So, without help, you are more likely to invest in a way that makes you a liability rather than an asset.

So what should you do and how can you maintain your asset status in retirement There are three things you need to do
You must first understand what makes you an asset today
Second, you need to understand what can make you a responsibility Tomorrow
And third, you need to know what to do to maintain your retirement asset status?

What makes you an asset
You are an asset today because you are earning a regular income. Stable, consistent income that is the right size for your needs and goals. You are also an asset today because you can meet the needs of others. If your income was irregular, you would be an asset today and a liability tomorrow. And if your income was less than your goals, you would be a handicap. So the main reason that you are an asset today is that you earn a stable income that can meet your needs and those of others. However, this stable, regular and constant income will disappear upon retirement. Before that happens, you have two choices to make. The first choice is to move from this disappearing income to passive income of equal size, stability and regularity. And the second choice is to go from that dying income to passive income that is irregular, unstable, and less than what you earn today. The choice is yours and that choice you are already making today.

The big question to ask yourself is this: who would you be at the end of your career. How much income would you earn? What quality of life would you maintain and do a better job to pay yourself than your employer or worse? Your answer to these questions and the subsequent preparation will determine where you end up in retirement.
Truth be told, you need some type of income to have a restful retirement life. This income must have the good qualities of the salary and leave the bad qualities behind. And it must also be the same that can maintain your standard of living.

What makes you a responsibility
When you’ve decided to volunteer your time, skills, and energy to serve your employer for 30 years, one of the things you haven’t decided to do is find yourself after 30 years of responsibility in retirement. But whether you decide it actively or passively, you are already making that choice today. The problem is, you might not know how you make that choice or how your current life affects your retirement life. So let me do you a favor and show it to you today. There are only two choices that will affect your retirement life. The first is the choice to live a rich life today. The second is the choice to live a better life in retirement. The two choices are opposite and you can only make one.

The truth is, you only have 30 years of guaranteed income to plan for the rest of your life. While your earning years are set at 30, your retirement years are not. Your retirement life expectancy can range from 15 years to over 30 years depending on the length of your life. So what you do in your 30 years of income will determine the quality of the rest of your life. To enjoy a restful retirement life, you must be able to increase your income or extend the income you earn to cover both today and tomorrow. If you spend most of your income living big today, you will only enjoy that life for 30 years, then it will be over. In retirement, you will suffer the consequences of your actions. For example, if you’re saving less than 25% of your income today, you don’t need someone to tell you where you’ll end up in retirement. Financial scarcity is the inevitable position for you. The only way to have a restful life in retirement is to save more of your income – 25%, 50%, or 75%.

Remaining an asset
To be an asset in retirement, you need to have the same currencies and resources that make you an asset today. There are five resources that make you an asset today. The first is income. Your income is the tool that helps you meet your needs and those of others. You need to keep the same amount and the same quality of income to be an asset in retirement. The second is your title or position. You are an asset today because many people see how your position can help them achieve their goals. To maintain that kind of relevance in retirement, you need to do meaningful work that draws other people to you. The third is relationships. You are an asset today because you have relationships that can get things done, open doors for you and for others. To be an asset in retirement, you must maintain a rich network of relationships. The fourth is productivity. You are an asset today because your time is meaningful and there are productive activities associated with your time. To be an asset in retirement, you need to stay productive and useful. The fifth is health. You are an asset today because you can pursue your goals without restraint. To stay an asset in retirement, you need to stay healthy.

The truth is, your retirement life is predictable and the only miracle that will happen in retirement is the one you create for yourself today. Failure to recreate the resources you will lose in retirement is the reason many suffer in retirement.
The big question is: can you really be and stay an asset in retirement, especially in a faltering economy?
Would you be able to seize invaluable retirement opportunities or be limited by money?
Do you have the resources and people you need to make a difference in retirement?
And would you be able to maintain your active status not only for 5 or 10 years, but for the rest of your life?
The answer is yes! And we can help you make it happen
To see if you qualify for our help, email

Grace O. Agada, a much sought-after financial freedom expert in Nigeria, is based in Lagos.


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