Retirement Planning: A Must For Everyone
There is a prevalent culture of joint family and the older generation expects the next generation to take care of them in the old age. Surely there is some form of retirement savings being done. But it falls far short of the actual need in absence of any proper planning with 100% financial independence. However, today there is an increasing need felt for retirement planning especially among those in the middle age group.
Here are some of the reasons why the growing need for retirement planning is felt.
Retirement planning is the process of arranging finances to meet expenses during retirement period. The idea is to collect enough retirement kitty so that you get financial independence in managing your personal expenses. The important considerations that go into planning for retirement are…
Key inputs like retirement age, expected household expenses, retirement period, inflation, returns on retirement kitty, returns on existing or new investments to build retirement kitty, existing assets & liabilities and the savings potential are used will arriving at the retirement kitty.
Each of the input stated above can impact the retirement kitty need drastically. While some of the inputs are in control of the person concerned, some, like inflation & retirement age are out of control. Building a retirement kitty is about taking smart decisions from today itself before it becomes too late. Some important factors that can be effectively managed and would help in retirement planning are :
Retirement kitty is something which is doesn’t easily figure on top of your ‘list of goals’. Observations show that the more you delay planning for your retirement, increasingly, the dream of having an independent, dignified retired life becomes blur. Retirement planning can be easy when you are in the initial 5-10 years of your working life and is perhaps the best years to start planning for retirement.
Quite often people are shocked to hear the retirement kitty requirement and mostly it is too late to do anything tangible. As investors we strongly recommend that you start planning & for your retirement at the earliest.