This has been mentioned earlier and we are mentioning it again. Retirement planning is crucial. However, many Indians have this thinking that retirement planning isn’t needed. Some reasons why people forgo retirement planning.
Life expectancy has increased; nuclear families have increased with children moving away from their parents after they begin working and healthcare costs have also risen. This is a lifelong procedure and not something you start doing when you are about to retire in a short amount of time.
Liquidity and growth are what you’ve to see in your corpus. You may require money to travel abroad to meet your children. Your retirement funds have to last a lifetime. Remember that you’ve 40 years to live a retired life on this planet while you retire at the age of 60.
Own a house or more than one house.
This way you can sell it or give it for rent to get additional income. You can purchase a home with a home loan, give it for rent and pay off the debt with the rent money till the loan is cleared.
Get a health insurance.
Your health will begin declining sooner or later. Ensuring your health will ensure that you don’t have to pay for all the medical facilities. You can sleep peacefully if you’ve insurance.
Wealth accumulation and withdrawal are what a standard retirement plan consists of. Possess financial assets like silver and gold, property, etc.
Ensure you have other funds for specific purposes.
Taking out money from retirement funds at times of emergency is not wise. For that, you need to have an emergency fund kept ready. A separate fund for distinct purposes is required now.
How to save for retirement when you are perhaps, in your 40’s and 50’s.?
1. Purchase a house or two
Buy a house or two so that you can sell or rent it out when you require money. In your case, renting is optimal as you’ll get monthly income. With monthly income, you can at least live a decent retired life later on without having to depend on your spouse, kids, relatives or friends.
2. Extend your work life
Consider working till you’re 65 or 70. If your current employer or government doesn’t allow you to work post 60, consider creating post-retirement benefits like equities. Ensure that you work longer, as you need money for independent retired life.
Your son’s education vs. your son’s favourite bike brand. Allocate money for his education and tell him to buy that bike when he starts working. Your daughter’s education vs. her casual shopping. Allocate money for her education and tell her to go shopping when she starts earning. If you allocate money for his bike and her casual shopping, you will be left with nothing for your retirement. They can purchase whatever they want when they start earning.
These are some methods you can start saving money while it’s really late to start saving for retirement.
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