Camille Van Vyve
26 Apr 2023
Investing in your 60s: structuring your capital to take advantage of it
To take advantage of these golden years of retirement, you must invest the capital accumulated during your professional career wisely.
What is your lifestyle?
As you approach retirement, you probably want to continue doing the things you love to do, and even practice them with more intensity. Do you want to travel more? Increase cultural and social activities? Move to a sunnier location or swap a house for an apartment? Above all, you want to be able to achieve all of this without worrying about your financial future.
Take out the calculator
If you haven't done so yet, it's high time to calculate the amount of pension you will receive when you retire. As this calculation is quite complicated, we advise you to use the free easyvest application and its pension planner, which allows you to combine your legal and supplementary pensions as well as your possible pension savings, in order to have an idea of your monthly pension income. You can also add other sources of income – rental income for example.
Establish your pre-retirement investment strategy
To look forward to the next 20 or 30 years with serenity, now is the time to put in place a solid investment strategy, which will allow you to add the necessary supplement to your acquired pension income. Start with the short term: do you foresee major expenses in the next 5 years? A new roof, a financial boost for your children…? These amounts must remain relatively liquid and should therefore not be invested heavily in shares for the long term.
Are you going to receive group insurance? Prefer the capital payment
If your professional career has been carried out in whole or in part in the private sector, you will probably receive group insurance, which is sometimes substantial. The most common way to receive it is capital liquidation, so that you can immediately dispose of the entire pension plan. This form of allocation is also the most advantageous from a tax point of view and allows you to leave part of the capital to your descendants.
Invest your capital as soon as possible
Given the current level of inflation, there is no question of letting the fruit of your group insurance, the sale of real estate, or simply your accumulated savings lie dormant in a savings account: over time, the power of purchase corresponding to these amounts would be seriously eroded, which is unlikely to be the case with your needs.
Enjoy the magic of compound interest
In addition, due to the phenomenon of compound interest, a year without a return will have significant long-term consequences since these returns will not be reinvested each year. Thus, a capital of €250.000 invested in shares for 19 years rather than 20 years would imply at the end of the period a potential shortfall of more than €50.000.
Don't complicate your life
For most of us, retirement is seen as a time to enjoy life and those close to us. If you are not a stockbroker, investing your pension capital yourself may be stressful and time-consuming. Set yourself a target retirement income and get advice on developing the best strategy.
Pay attention to fees
A seemingly small difference in management fees can make a huge long-term difference to total return: so be careful on this point! The passive investment strategy offered by easyvest has the double advantage of transparency and one of the lowest prices on the market.
Don't take too much risk
The share of risky assets in your portfolio should change according to the phase of your planning. At retirement, it is recommended to build up your portfolio of around 40% less risky assets by investing, for example, in a tracker of European government bonds, and it may be appropriate to gradually increase this proportion until the end of the investment horizon. This will preserve your capital and guarantee a stable pension throughout your pension.
Make sure you have a steady income...
In the structuring of your portfolio, you could provide for the payment of an annuity, in order to be able to benefit from a regular income. This annuity will not be subject to personal income tax. Only the financial taxes (TOB, withholding tax, tax on securities accounts) will be due. Our simulator makes it possible to calculate in a few clicks the annuity resulting from a capital X or the level of capital necessary to generate an annuity of X.
…Or grow your capital
Those who are lucky enough to be able to count on sufficient pension income will no doubt wish to invest part of their available capital for the long term, in order to optimize their estate. For them too, easyvest offers suitable investment formulas.
Invest your pension capital with easyvest
Many retired or near-retired clients have already opted for easyvest's investment portfolios, which allow them to look forward to retirement with financial peace of mind. Whether it is a question of making the capital accumulated during his professional life grow, of drawing an annuity from it, or both, the advisers of easyvest can help you structure this type of portfolio in the best way. Our passive investment strategy delivers market returns at lower cost and is unbeatable over the long term. Do not wait any longer to make your simulation online!
Read the other articles in the “Investing by age” series: investing as of 1 year old, investing in your 20s, investing in your 40s, and investing in your 70s.