By INDERIA SAUNDERS, Guardian Business Desk, Inderia@nasguard.com

Rising costs are not only affecting the bank balance of the average Bahamian, but are also chipping away at her retirement fund.

Amidst increasing gas, food and electricity prices, caution investment specialists, many Bahamians forget about paying another bill — monthly contributions to their nest eggs. Now's really the time to step up those payments, argues Khalil Braithwaite with Colina Financial Advisors Ltd.

"In good times save, in bad times, save even more (because) a possible recession is going to have some indirect effects," he told Guardian Business Thursday. "Generally 10 percent is enough, but realistically people should be looking at saving around 15 percent."

There in lies the rub.

Many Bahamians, acutely aware of their dwindling disposable income, are unable to put more money into a retirement fund at a time when they are required to spend more for basic breadbasket items.

The savings habits of most people, holding on average $1,000 in a bank account, was already a concern before the cost of living increase. The diminishing purchasing power may likely drive more Bahamians to dip into their savings accounts, rather than shore them up.

Still, Braithwaite and others point to the importance of continuing contributions to those accounts.

"The challenge is greater and the morale is dampened because people like to put large amounts (on their accounts, rather than less)," he said. "Amidst these challenges we can't let economic forces undermine our goals . . . because we have to save less don't mean we should stop saving."

With uncertainty still marking the economy, Braithwaite is also cautioning Bahamians to take better advantage of overlooked savings plans like those offered through work and focused on matching contributions from employers.

"If you sacrifice and give that 7.5 percent, then you increase your savings, because they'll have to meet you with the other 7.5 percent," Braithwaite said Thursday.

Currently, too many of us rely on National Insurance contributions to carry through retirement.

Speaking at CFAL's second annual retirement planning seminar last year, president Anthony Ferguson argued that the funds in the NIB plan were significantly decreasing over the years and that Bahamians must begin saving independently of their NIB contributions. Failing that, they may find themselves shut out of the relatively affluent lifestyle marking life in this country.

"If we continue along this path, 70 percent of Bahamians will be living below the poverty line as defined by the lifestyle here in The Bahamas," said Ferguson, who is also president and publisher of The Nassau Guardian.