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#BTColumn – Retirement awareness is critical

Disclaimer: The views and opinions expressed by the writer(s) don’t represent the official position of Barbados TODAY.

by Dennis DePeiza

A standard definition of retirement, refers to it as “the time of life when one chooses to permanently leave the workforce behind.”

From a layman’s perspective, retirement is usually considered a strategy of time, which commences when the worker has reached the utmost age at which he can proceed within the employment of a personal sector enterprise or as a public sector worker.

While age is generally applied as the premise for retirement, the strategy of retirement can nevertheless start where upon an worker is forced into early retirement by virtue of health reasons.

The mandatory age of retirement in the private and non-private sector often tends to be a matter of divide and controversy. It is thought that the age of mandatory retirement can vary between ages 55 -67.

In bringing clarity to the age of retirement, research drawn from Wikipedia, identified that, ‘the retirement age is the age at which an individual is anticipated or required to stop work and is generally the age at which they could be entitled to receive superannuation or other government advantages, like a state pension.’

It is necessary for employees to know the difference between when you find yourself eligible to retire, and the difference between minimum retirement age and normal retirement age.

It is claimed that retirement in a general sense is the time of life if you not must work to live comfortably, and may depend on savings or passive types of income to fund your lifestyle.

Whereas this sounds as music to the ears, it’s buttressed by the purpose that an worker can decide to retire at any time. It is strongly recommended that in contemplating such a choice, it is sensible to contemplate if the person has worked for the required variety of years to be able to be eligible for a pension and a gratuity; and more so within the case of the latter, where such is paid.

It might definitely be clever for a person to also consider in the event that they have reached the qualifying age which triggers the payment of Social Security or National Insurance advantages.

It is necessary to know the age at which you possibly can retire and collect Social Security/National Insurance advantages. It’s to be made clear that the age at which you must retire and that at which advantages are to be paid, aren’t necessarily the identical.

There ought to be an awareness of the Social Security/National Insurance advantages to which a retired worker is entitled. The understanding is that these may differ from country to country.

Principally, social security advantages provide alternative income for qualified retirees and their families. These include retirement, disability, survivors and supplemental advantages. For instance, a retiree is to receive a monthly cheque, which is computed based on the employee’s age and the amount of cash the person has earned over their work history.

The calculation of payment is made on the salary paid on the time of the exiting of the worker from the system.

Early retirement is an option which some employees contemplated. That is comprehensible in that, “By the point some employees reach their 50s and early 60s, they’re beginning to feel burned out, so retiring before the normal age of 65 can feel invigorating.

Men retire at a mean age of 64.6 years, while for girls, the common retirement age is 62.3 years.” (Investopedia: Daniel Kurt: January, 04, 2022)

For individuals contemplating early retirement, there are to be mindful of the drawbacks in doing so.  For instance, claiming advantages before full retirement age will lower your monthly payments. As a way to get your full retirement profit, it could be best to attend out the total retirement age before retiring.

It’s obligatory that employers pay the legally required contributions into the Social Security/ National Insurance fund on a monthly basis. They failure to achieve this is by all intents and purposes a criminal act, because it denies employees their entitlements, taking into account that Social Security provides the retired worker with a source of income.

The actions of those employers who fail to comply is most reprehensible, considering that the impact this has on those who are suffering a disability and are forced out of labor. It’s to be taken on board, that the social security advantages are used to support your legal dependents, resembling the spouse, children, or parents, who lost a member of the family through the course of duty or because of this of an injury sustained on the job.

Employees are urged to press their employer to supply a pension plan when such is nonexistence within the organisation.

A pension plan is a sort of retirement plan that gives monthly income for the worker after retirement from the job. As an worker, chances are you’ll contribute a part of your wages to the plan.

Generally, the plan requires that the employer contributes to a pool of funds invested on the worker’s profit.

Principally, that is what’s often called a Contributory Pension Plan. This can be a sort of pension plan where the quantity you get on retirement, depends upon how much you place in and the way much this money grows, based on the worker’s and employer’s contribution.

Dennis DePeiza is a labour & worker relations consultant, Regional Management Services Inc. www.regionalmanagementservices.com

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