The famous economist John Maynard Keynes once quipped: "In the long run, we are all dead." But just because your sunset years are a long way off doesn't mean you need not prepare for life after work.

In fact, with life expectancy now getting far longer due to advances in health care, there is even a growing need for people to give serious thought to their retirement as early as possible.

"People today may live 40 years or more in retirement. They outlive their money. The biggest single crisis facing the world is not the credit crunch. It's what to do with the pensioners in future years if they have not prepared for their own retirement," says Steve Gregory, director of technical services at Holborn Assets Insurance Brokers.

A recent study shows that expatriates in the Gulf are now taking a measured approach towards retirement planning. According to Zurich International Life, over half of those interviewed are not changing their retirement plans despite the economic crisis, and an additional 22 per cent are now paying further contributions to their pension schemes.

However, for many of the residents in the UAE who are mostly expatriates, there are no state pension plans to speak of, so they are left on their own to secure their retirement years while working overseas.

Still, there are a lot of options for them to grow their money which they could use in their retirement. The simplest way is to put money in the bank and once it grows, they may choose to invest it in various asset classes. Other options would be buying a pension policy, investing offshore or in equities and other money-making schemes.

Some expats, depending on which country they come from, can continue their contributions to the government pension or social security plans in their home country, or to a personal pension plan that was in existence before they left - although certain rules apply.

"The UAE does not offer pensions to expats, although the company gratuity schemes are designed to at least partly offset provision that may have been made in the home country. In fact, there are no real pension plans available in the UAE, despite the names of some insurance company plans. Instead there are a variety of savings schemes," says Keren Bobker, senior consultant at Holborn Assets Insurance Brokers.

"The UAE is unique in terms of the number of expatriates that reside in this country. Almost all of these people have minimum or no retirement benefits provided by their employers. Expatriates living in the UAE must build their own retirement nest by saving from their current earnings," adds D.J. Sengupta, head of investments and insurance at Citibank UAE.

But while you may think that putting your retirement money in a bank is a safe approach, Darren Ashley, managing director at Candour Consultancy, cautions that the interest on your deposit is unlikely to keep pace with inflation. Hence, saving via an offshore pension plan is more viable: it offers some exposure to the equity markets and, therefore, offers potentially higher returns over the long term.

Expats can purchase a pension policy through a bank or directly from life assurance firms. Ashley says life assurance-based pension schemes will allow you to build a portfolio of funds for the same contributions, thereby diversifying and spreading the risk.

At HSBC, residents can opt for a long-term saving programme called Zurich Future Perfect, which is a contribution plan, or invest into the bank's Freedom Funds, a range of fund portfolios for long-term investment.

"These can be tailor-made for adventurous investors to the more balanced investors. The funds provide investors a managed and diversified investment opportunity," says Ishrat Kiyani, regional head of wealth management at HSBC bank Middle East.

Citibank also offers some short-term or long-term plans that people can use to secure their retirement.

One of them, called the Systematic Investment Plan, which is more suitable for people who are nearing retirement, works on dollar-cost averaging and the power of compounding.

"In this plan, a customer contributes a fixed sum every month. The plan typically matures in three years. After three years, the customer gets back an amount depending on how the markets have performed. Customers have a choice of over 100 mutual funds to select from," explains Sengupta.

At Emirates NBD, retail banking general manager Suvo Sarkar says they offer flexible and customised retirement plans from insurance providers. "Some plans offer a unique option wherein the pension is guaranteed for a minimum period of 20 years and life thereafter."

Another option, which is often more suitable for company owners, the self-employed and those on commission, is to invest via an offshore bond.

Generally, offshore bonds can be started with an initial contribution of $15,000 (Dh50,050) plus and ad-hoc contributions can be from $2,500.

"Like the pension schemes, offshore bonds are generally provided by life assurance companies. However, whereas a pension scheme commits the policyholder to saving a smaller amount on a regular basis, an offshore bond allows the policyholder to make larger ad-hoc payments as and when they have spare income," Ashley explains.

Ultimately, he says, the offshore savings plan and offshore pension plan from a company are exactly the same product in terms of charges, contribution levels, enhancements and fund selection.

"The only difference is that the brochures of offshore savings have pictures of young families while the pension plans replace these with pictures of older people watching the sun go down on the beach. I would suggest choosing the most economical scheme for your personal circumstances and disregard whether it is called a savings or pension plan," Ashley says.

Although this may seem unpopular, companies in the Middle East can actually offer pension schemes, instead of gratuity, to their employees.

"For several years we have been trying to educate companies [about] the benefits of a company pension scheme over gratuity - which is not going to provide enough money to live on in retirement. Company schemes are shown to attract the best staff and increase staff retention, saving considerable money on recruitment and training," Ashley points out.

Investing in funds or in other financial instruments could be another option, but Ashley cautions against putting your eggs in one basket.

By Cleofe Maceda