A dignified retired life is what everyone deserves after years of hard work. It is imperative to plan for the retirement along with other financial goals like child education, own house, etc. to lead a self-sufficient retired life. It can only be achieved with a proper retirement planning. Below are some useful tips to achieve the retirement goal.
Tip 1: Invest in yourself
Select the most suitable retirement scheme and start investments. Most popular retirement instruments are the National Pension System (NPS), the Public Provident Fund (PPF), a dedicated Systematic Investment Planning (SIP) in mutual funds, etc. Each scheme comes with some pros and cons. Take expert advice to understand every scheme in detail, before making investments.
Tip 2: Plan early to make the best use of time
Most retirement schemes yield good growth when invested long, as they can beat market volatility. The power of compounding can be fully utilized only when the investments are started earlier. In fact, the earlier you begin your investments, the lesser you need to invest monthly to achieve your required amount.
Fig. 1 Infographic showing investment amounts required at different ages
Tip 3: Ensure that your retirement corpus is enough to beat the inflation
Calculate the required retirement corpus after considering factors like inflation, desired lifestyle, the number of years left for retirement, spouse’s age, and the span of your retired life. A proper financial planning with expert guidance can help make accurate calculations and thorough preparations. In short, building the right investment portfolio is the key. A quick glance at the table (fig 2) reveals some interesting facts of various savings schemes.
Fig 2: Table of Compares Various Saving Schemes
*Average returns of Money Market Fund over 5 year period.
** Based on average historical data from ArthaYantra database.
In conclusion, move ahead with a vision and plan your retirement along with other financial goals of life. Fulfill all your post-retirement ‘’to-do’’ bucket list with confidence