Sharon Hamman | What financial legacy are you building?

Heritage is more than what we inherit. It is what we preserve, what we build, and ultimately what we pass on. During Heritage Month, we often reflect on the stories, values and traditions handed down to us. But perhaps the more important question is what we are leaving behind for those who come after us.  The answer is shaped, in large part, by the financial decisions we make today.

Few decisions carry greater long-term consequences than retirement planning. How prepared we are for retirement will influence not only our own quality of life, but also the financial burden or freedom we leave to our loved ones. A secure retirement gives our children the opportunity to focus on building their own futures. 

This Heritage Month, don't simply ask whether you have a retirement plan, ask yourself whether your retirement will strengthen the legacy left behind, or place it at risk.

Having a plan isn't the same as being ready

Recent industry research by First National Bank (FNB) into South African retirement attitudes found something encouraging on the surface: 73% of South Africans under 60 now say they have a retirement plan, up significantly from 60% a year earlier. That's real progress, particularly among lower-income consumers, where plan ownership nearly doubled.  

Yet despite more people having plans, retirement readiness has barely improved. One of the main reasons is because having a plan and being prepared are not the same thing.  

Many people still feel uncertain about financial matters. Rising living costs, unexpected emergencies and competing priorities continue to erode long-term savings. Even those with the best intentions often find themselves sacrificing tomorrow to cope with today.

In addition, longevity is a growing risk factor that many underestimate.  For previous generations, retirement may have lasted a decade or two. Today, people are increasingly living into their 80s, 90s and beyond resulting in retirement spanning 30 years or more, becoming the norm rather than the exception.  

The uncomfortable reality is that a retirement plan built on outdated assumptions may fail long before life does.

Why this is about legacy, not just retirement

Longer lives are changing more than retirement itself. They are changing how wealth is transferred across generations.  With parents increasingly living well into their 90s, their children may already be approaching retirement themselves by the time they receive an inheritance. By then, many of life's major expenses and opportunities have come and gone, which raises an important next question: if your financial legacy arrives when it is no longer needed, has it achieved its purpose?

More families are beginning to think differently, considering ways to support future generations during their own lifetimes, when it really matters, funding education, housing, entrepreneurship or other life-changing opportunities.  The goal is no longer simply to leave something behind, but rather to make the greatest difference when it matters most.

Preventing the sandwich from becoming the “footlong sub”

Longevity is placing increasing pressure on the so-called "sandwich generation", those simultaneously supporting ageing parents, adult children and sometimes other family members.  When retirement plans fall short, the consequences rarely stop with one person. Financial strain can ripple through an entire family, affecting multiple generations at once.

This is why genuine retirement readiness is one of the most powerful gifts you can leave behind.  It means your children inherit your legacy, not your financial shortfall.

Rethinking what counts as a retirement plan

A retirement plan is more than numbers on a spreadsheet.  For many South African families, retirement and legacy planning have always been deeply connected.  It may be a family property passed from one generation to the next. A small business built through years of hard work. It may be a skill, trade or enterprise that creates opportunities long after the original owner has stepped away.

A true retirement plan does more than provide for you. It creates stability, opportunity and resilience for those who follow.

A Heritage Month reminder

You do not need to reinvent your financial future overnight.  But Heritage Month offers a valuable opportunity to pause and ask yourself some honest questions.  Is your retirement plan still realistic, given how long you are likely to live? If you retired tomorrow, would your family inherit stability, or would they inherit your shortfall? And are you having these conversations across generations, early enough for them to matter?

A financial adviser can help answer these questions, identify risks before they become crises, and help you align your retirement strategy with the legacy you hope to create.

Because your financial legacy is not something that begins when you retire, nor is it defined only by what remains when you are gone.  It is being built right now, through every decision you make, and one day, the people you love will live with the consequences of those decisions.

What financial legacy are you building today?

*Sharon Hamman is Senior Legal Adviser at Momentum.