5 ways to plan for your retirement

You can have a peaceful retirement when you plan for it today. We present 5 ways to do so.

Though every person knows it is coming, not every person is able to make the most of it. Retirement is a time for catching up on life, but you cannot do so if you are short of funds!

Here are 5 ways to plan for a stable retirement:

#1 Save every month.

The first step towards financial independence starts with saving money. Make sure you only deposit money in a separate retirement savings account, and not withdraw from it for any reason. Aim to save at least Rs 10,000 from your monthly income in this account, every month. Over time, you will build a sizeable savings fund, which you can retain as is or invest in a fixed deposit or market-linked option for higher returns.

#2 Invest in a retirement plan.

A retirement plan gives you a regular stream of income when you need it the most – after you retire, when your work income stops but expenses continue as before. Use a retirement calculator to estimate your future needs, and to know how much money you will need to invest regularly to get the retirement of your dreams. Now, pick a retirement plan with a leading insurance provider in India, and start investing in it to build a good sum for your future.

#3 Automate your SIP payments so you don’t have to do it manually – this helps you stay on track.

Apart from the options mentioned above, you can invest in market-linked options like mutual funds, by starting an SIP (Systematic Investment Plan). The SIP offers the advantage of affordability, which helps when you have many expenses to deal with and not too much surplus money lying around for expensive investments. If you feel that you are unable to stay on track with your SIPs, you should automate the payments so that they are auto-debited from your account every month.

#4 Invest in a smaller property for your retirement.

Your retirement years will probably see you living with your spouse in the house you occupy at the moment, with the children leaving for their own homes and families. It might become difficult to maintain a big house at an advanced age, and with no income. It would be wiser to invest in a smaller, second home for your retirement. You can have two advantages: 1) You can move into the smaller home when you retire, and sell/lease your current house for extra income, and 2) If you decide to stay on in your current property, you can liquidate the second home for income.

#5 Invest in a child plan to pay for your children’s higher education.

Children’s education is a necessary but high expense. You might have to fork out large amounts of money to finance your child’s higher education, and this may deplete your savings at a later date. Instead, you should invest in a child education plan that can pay the costs of higher education, while safeguarding your savings and income from the same.

About This Author

Shaheen Shaikh http://www.adrclinic.co.uk Joined: April 29th, 2018