How to adapt your financial plan as you age

Life rarely stands still. As we move from our first pay cheque to retirement, our responsibilities shift, and so should our financial priorities. But where do you start? Your financial circumstances will look very different at 25 than at 55, which is why it’s important to understand what to focus on at each chapter of our lives.

Many young South Africans enter the workforce while juggling student debt, car repayments, and the costs of living independently for the first time. This is the time to focus on the basics: understanding your payslip and tax obligations; finding the right medical cover for your needs; creating a realistic budget; building an emergency fund; and insuring the important things first.

It’s essential to understand that your income is your most valuable asset. It pays for everything else in your life, from food and housing to healthcare. Protecting your ability to earn an income when illness or injury strikes should be your number one priority from your very first payday.

Building your career and starting a family (25-35)

Here, priorities typically broaden to include milestones such as buying a home, getting married, or starting a family. With dependents in the picture, life cover becomes important. If someone relies on your income, you need to know they’ll be taken care of if you pass away.

Traditionally, life cover pays out as a lump sum when you pass away, which enables your beneficiaries to pay off large, once-off debts, like a bond. However, choosing a combination of Life Lump Sum and Life Income benefits goes one step further, giving your beneficiaries the peace of mind that they’ll also be receiving a dependable monthly income as well. For instance, a Life Lump Sum benefit could help your family pay off a bond, while a Life Income benefit ensures they still have a regular ‘pay cheque’ for everyday expenses like school fees and groceries.

This is also a good time to start saving for retirement – and the earlier you begin, the more you’ll benefit from the power of compounding interest to grow your savings over time. As you continue to build your life and begin acquiring assets like a house, a car, or valuable personal items, and as others become financially dependent on you, it’s equally important to draw up a will. This ensures that your debts are settled, your wealth is distributed according to your wishes, and your loved ones are protected.

Balancing changes and new responsibilities in midlife (35-50)

By this stage, many people are juggling competing responsibilities: advancing careers, raising children, and often supporting ageing parents. This ‘sandwich generation’ pressure can spread household finances thin, making it crucial to step back and reassess your financial plan.

This is the time to focus on future-proofing your income and lifestyle. Make sure your life insurance keeps pace with your salary and family needs. If you don’t already have it, consider adding Extended Income Protection alongside Temporary Income Protection. This benefit pays up to 100% of your insured income until retirement if illness or injury prevents you from working, even if you’re not permanently disabled, creating a stronger, longer-term safety net for you and your dependents.

Your children’s school and university fees can be one of the biggest financial commitments during this stage, so start saving as early as you can. Work with a financial adviser to build a diverse investment portfolio that balances growth with risk, helping you meet your children’s educational needs while still building your own wealth for retirement.

And finally, revisit your long-term commitments: review your will, check that guardians and beneficiaries are up to date, and ensure that your financial plan can evolve as your family’s needs change. Taking these steps now can give you peace of mind and a clear path forward, even in life’s busiest years.

Getting ready to retire… And then enjoying it (50+)

As retirement comes into view, shift your focus to ensure you are sufficiently resilient financially. Settle major debts like your bond, boost your retirement savings, and work with your financial adviser to transition from building wealth to strategically drawing on it, ensuring that you can enjoy retirement while still leaving a meaningful legacy. Also, check that your will is up to date, covers your entire estate, and clearly names your inheritors. Remember, the beneficiaries of your life cover and retirement savings must be named in those policies.

While your financial priorities will evolve with each stage of life, two essential rules that will set you up for success:

1. Protect your monthly income first. If illness or disability prevents you from earning, everything else in your financial plan is at risk.
2. Keep your life insurance up to date. As your life evolves, your cover should grow and adapt alongside it.

A good financial adviser helps you regularly review your cover and investments, adjust them as your circumstances change, and make informed decisions that keep you on track. Financial planning isn’t something you do once. It’s a lifelong journey.

* Beattie is the acting chief marketing officer at Bidvest Life.

 PERSONAL FINANCE