By Bertie Nel, Head of Financial Planning and Advice, Momentum

As you approach or actively plan for retirement, you may find yourself juggling a maze of financial products while considering life changes, job moves, promotions, or financial decisions. The result is a fragmented financial landscape and a blurred vision of your actual retirement outcome.

The solution lies in achieving quality, purpose, and alignment across your entire portfolio.

The science of success

The principle that success favours the focused is particularly relevant to financial planning. In the context of retirement, focus means cutting through the noise and complexity of fragmented products to concentrate on your desired retirement lifestyle.

Retirement planning works best when it is focused. By streamlining your financial products, you reduce complexity, enhance efficiency, and ensure every rand is working optimally towards your future goal.

Here’s how streamlining your portfolio grows success:

1. The duplication and redundancy trap

Over time, people often end up with multiple products designed to serve the same purpose.

Each product has its own fees, administration charges, and management cost. When they are not coordinated, you pay multiple times for the same service and unnecessarily erode your long-term returns.

Streamlining eliminates expensive redundancies, allowing you to pool assets in favour of more cost-effective solutions.

2. A blurred vision of the outcome

When your savings are spread across various accounts, it becomes difficult to track your progress accurately. You may feel like you have a lot of money saved, but you lack a clear, consolidated picture.

A lack of clarity hides your actual shortfall or surplus – it’s difficult to steer a ship when you can’t see the horizon.

A streamlined portfolio provides a single, unified view of your total retirement capital. This clarity simplifies decision-making and allows you to precisely measure your progress against your goal.

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3. Inefficient tax management

Different products come in different wrappers (like retirement funds, endowments, or unit trusts), each with specific rules for contributions, growth, and withdrawals.

An uncoordinated mix can lead to a suboptimal tax outcome. You may be over-contributing to one while under-utilising the benefits of another, missing out on possible tax efficiencies.

Streamlining, guided by professional financial advice, ensures your products are strategically selected and managed, maximising the growth of your capital through effective tax planning.

4. Complexity creates inertia and poor decision-making

A file of confusing policies and multiple online portals can feel overwhelming and lead to procrastination or panic-driven decisions.

The complexity can cause you to leave products unattended or make reactive choices based on market noise rather than ones informed by your long-term strategy. Noise and comparison distract from what matters.

Simplifying your structure makes your financial life manageable. You gain the confidence to make deliberate, informed decisions that align with your plan.

5. Lack of strategic alignment

Products acquired at a different life stage may reflect old goals or priorities and no longer be the best fit. Streamlining is a process of strategic alignment, ensuring all products pull in the same direction towards your retirement goal.

The power of professional advice

Retirement success is the outcome of focus and alignment. The key to achieving a streamlined vision is professional financial advice. An accredited financial adviser is a critical partner in the process of simplification.

By working with a financial adviser to streamline your portfolio, you can cut through the noise, remove unnecessary complexity, and ensure your financial future is focused, and remains on track.

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