Post-retirement the expenses don’t recede, so it becomes more critical for a person to plan his life after retirement. It becomes paramount to rely on alternative sources of income after he retires from his professional career.
Retirement planning involves investing in numerous funds, saving in banks, and managing risk and assets before their retirement.
How To Improve Retirement Planning?
Retirement planning is done to determine the future financial goal and the ways to accomplish those goals.
Individuals invest in insurance plans, and savings account in an unsystematic manner, yet one may consider the following points to improve their retirement plan and lead an enjoyable life.
1# Outlining goals and targets
Once an individual retires from his career, his primary source of income may come to a halt, but his expenses wouldn’t recede, so it becomes essential to rely on an alternative source and plan accordingly.
It is crucial to outline and figure out the amount that he will require after retirement as his alternative source to rely on.
Investing in fixed deposit is considered beneficial for higher returns in the future. Yet, it is advisable to write down your financial goals, and the current savings you may have can be invested in funds giving higher returns.
2# Discover employment benefits
An individual may have the annual bonus, PF, about which they wouldn’t be aware of and which could probably help them to save more. So, it is advisable to talk to the company’s HR and get a claim over those benefits.
3# Budget plan
It is necessary to figure out a budget based on the current expenses and inflation rate. After meeting the monthly expenses, the amount saved has to be used prudently.
The retirement goal can be achieved only by having a roundabout figure that would be available after retirement.
4# Investment plans
Besides putting a certain percent of the income into a savings account, a person should consider investing in assets involving higher risks.
Saving from a young age helps a person to accumulate more. Individuals who start earning early can opt to invest in riskier funds and earn higher returns.
From the variety of funds available in the market, a person may opt to invest in equities and corporate shares with a monthly investment, which could be as low as Rs. 500.
Besides these funds and shares, a person can also invest in a fixed deposit, which provides a return rate of up to 8.9%.
Be updated with the market trends so that you may invest in assets that would cater to your needs in the future.
5# ULIP
Investment in market assets involves considerable risk, which cannot be afforded by all. The alternative option that a person may opt for can be investing in Unit Linked Insurance Plans(ULIP).
Investment in ULIP can be used to invest in equities, funds, or safer government securities as per your preference.
Based on the market trends, returns will be credited in your account and would help to get a considerable retirement corpus.
6# Tax benefits
Besides the advantage of getting the income from alternative sources after retirement, investing in specific investment plan helps you to get a tax benefit.
For example, by investing in Equity-linked Saving Schemes (ELSS) may help you to get a tax exemption up to Rs. 1.5 lakhs, but the only condition is that you have to lock-in your investment amount for at least three years.
7# Self-Employment Opportunities
Retirement can be a beautiful plan if it is well spent and managed. In humankind and in your whole extensive years of lifetime, there are so many unfulfilled desires. It is now which you can make the most fruitful years of your life.
Kick start your business, begin with your consulting, start your coaching classes, or turn your hobby or passion into a full time business.
Having little flow of money doubled with the pension can be significant.
8# Health claim plans
This is so important. As you get older, your body can start giving up. But you still can maintain yourself and reap good health and body. But, don’t ignore the role of insurance and health claim. They can act as a last moment saviors.
After retirement, life comes to a halt, so being occupied in some sort of work makes you feel less miserable. It is also advisable to take a part-time job or else to work on your passion.
Even being a part of social activities will help to keep you active and occupied during your post-retirement period. Every day will be an opportunity to learn, be it technology or about your family.
The recommendations mentioned above may put you to work hard now, but it will definitely bear fruit in the future.
Retirement Planning can also start at an early age. Saving money starting from your 20”s is an excellent habit to cultivate.
Retirement is involuntary. Either it can be done by making a choice, or is most of the cases; it is a necessity that needs to be made. Save Smart, plan smart, and enrich your post-retirement life.
Also, study and get yourself into the finances and check. At the end of the day, you are planning your life. Compare different investment options.
Get in touch with a financial advisor can be helpful. Use all the strategies wisely. Save money; old age is a blessing. Live it, cherish it and make it the best years of your life.
Read Also:
- Why You Need A Retirement Plan A, B, And C
- When Retirement Savings Just Aren’t Enough
- Running a Rental Property Business in Retirement
Author Bio: Sakshi Kharbanda
