It may seem easy to put off retirement planning until later in your career. But planning for retirement needs to be an urgency as soon as you start earning. This holds true if you want to have a say in what your golden years should look like. You don’t want to reach 68 and be forced to keep working or rely on your children to get by.
People make dozens of excuses for not saving for retirement. They think that they can worry about retirement later. Right?
Planning for retirement now could help you lead a peaceful life later. If you want to get your retirement planning on track in 2018, here are simple resolutions to get you started:
Resolution #1: Define Your Retirement Dreams
This first resolution is a fun one; it includes a little dreaming. If you are married, involve your spouse too. All you need to do is discuss your dreams and goals with each other, and work towards the creation of a common vision for your future.
Define if you:
- Want to travel?
- Want to devote more time to your grandkids and family?
- Want to continue work part-time post-retirement?
Once you have a clear picture in your mind, put a rupee sign on your dreams! Plan how much you must save for retirement based on your goals and needs.
Resolution #2: Increase Your Savings
If you want to build a hefty nest egg, try and save 15 percent of your income toward retirement each month. Here’s why:
Let’s say you are saving Rs 2000 a month on a yearly income of Rs 4,80,000. That means you are stashing around 5 percent of your income toward retirement. This amount won’t get you any closer to your retirement goal!
Starting this year, invest 15 percent each month. Cut back your expenses, kick your intensity into overdrive and see where you can find the extra retirement money.
Although it might take some efforts to increase your savings, your future self will definitely thank you later.
Resolution #3: Invest You Money in The Right Instrument
When you are ready to make the most of your retirement, the best way to start is to invest in an instrument that can generate good returns over time.
SIP investment is one of the preferred ways for happy retirement life. In SIPs, a fixed sum is invested periodically in specific mutual funds. This ensures enough savings and helps beat inflation, which ultimately leads to peaceful retirement life.
Thus, generation of inflation-proof income through disciplined SIP investment will comfortably last you, as well as your spouse.
Resolution #4: Focus on the Long Term
This resolution may astonish you. But you need to keep your hands off your investments in the good as well as bad months. Why?
Because the compounding factor needs time to grow your money. The longer your money remains invested, the larger your nest egg becomes.
Along these lines, set yourself up for the good and bad times that accompany investing and focus on leaving your cash where it is. After all, the only way you get hurt on a crazy ride is if you jump off.
Resolution #5: Take Help
If you want to get your retirement planning on track, one of the most important resolutions you can make is to get connected with a good fund house having retirement plans to cater your needs.
A good fund house can help you:
- Identify your retirement goals and show you ways to reach them
- Choose mutual funds with a history of strong returns
- Keep a long-term perspective
When it comes to retirement planning, it’s always better to take help from professionals who are willing to empower and educate you with the information you need to make smart decisions about your future.
The Bottom Line:
Choosing SIP in equity funds will help avoid the temptation of hopping from one asset class to another during uncertain market conditions. Thus, it will provide you with a secure cushion (which will be of much help when you are no longer working).
In simple word, these resolutions for retirement planning will offer a powerful lineup and help you make a smooth transition from workforce to work less.