Retirement Planning

One of the most neglected areas in personal finance matters is planning for one’s retirement. We’ve found that most individuals begin planning for it when they are in their 50s. Particularly a person having not only his young children to take care of but also his elderly parents, and hence end up postponing retirement plans till his twilight years. Individuals save for big ticket items —buying a house, car, planning for a vacation, etc. Yet they tend to ignore that the most important time they’ll ever ‘buy’ in their lifetime is their retirement. Most of our clients never have a perspective of ‘buying’ their retirement, but that is exactly what we should do when we allocate a certain portion of their income towards the retirement fund. We ought to give them a reality check. It is here, where we play important role to guide them prudently to help their dreams come true be it providing for their retirement or making optimum utilization of tax benefits.

Why You Need A Retirement Plan?

5 reasons why we need a retirement plan after all:

  • To cover daily living expenses.
  • To meet medical expenses.
  • To fight inflation.
  • To deal with uncertainties.
  • To meet your other retirement objectives.

“When should I start planning for my retirement?”

Well, the simple answer is—the earlier the better. Starting early facilitates compounding of wealth that multiples with a wider investment time horizon. Remember, the early bird gets a bigger pie. Nevertheless, if someone hasn’t begun planning for his future, we ask him to start right away.

  • Start retirement planning as early as possible, it’s best to start at the beginning of the career.
  • Do not postpone retirement planning if you do not have requisite amount of money needed.
  • Start off with what you have and make up for the deficit at a later stage.
  • Don’t wait for an ‘opportune’ time, it might be too late by the time you start.
  • Strive to strike a balance between your present and future needs and save more to add to retirement kitty.

“Which are best investment avenues to plan for my future?”

From a galore of investment avenues we ought to select the ones that suit our clients’ best based on their investment objective and investment time horizon. Today, there are few products that are titled and positioned to address goals such as children’s education, marriage, and the individual’s retirement. But we believe, there’s no point getting carried away – we analyse the product details carefully. We also ensure that the client who’s addressing an important goal such as retirement, needs to be optimally insured because tomorrow if something untoward were to happen, the money from insurance claim can come to the rescue. , it is prudent to opt only for pure term insurance policy with an optimal risk cover because endowment plans or Unit-Linked Insurance Plans may not be sufficient to meet the goals.

Remember the necessary steps for Retirement Planning :

  • Determine or quantify the corpus necessary.
  • Determine the amount that needs to be invested every month.
  • Most suitable asset allocation plan.
  • Selection of investment avenues that hold the most potential to achieve the financial goal envisioned.
  • To invest regularly and not to dip into money saved or investments, to meet less important priorities (such as buying a car, going for a holiday, and so on).
  • Ensure to hold an optimum insurance coverage.
  • Implement the plan effectively and review the portfolio at regular intervals to ensure that it’s on track to meet the retirement goal.

Retirement Planning Calculator