What is the Importance of Retirement Planning?
The earlier you kick-start planning for your retirement, the more time you have to benefit from the power of compounding and maximize the likelihood of achieving your financial goals.
The prices of goods and services are on an upward spiral, leading to a dent in the purchasing power of money. The product you buy today for, say, Rs. 1000 could cost a lot more after a few years. A sound retirement plan could help you beat the blues of inflation and build an adequate corpus to meet your retirement goals.
Maintain your Standard of Living
Are you financially secure to keep pace with the rising cost of living even after you stop earning? If not, it's time you create a roadmap for your retirement and start investing to maintain your current lifestyle post-retirement.
Fulfill your Retirement Goals
You retire from your responsibilities at work, not life. Retirement opens doors to exploring new places, pursuing your hobbies, and pursuing other aspirations. If you fail to plan and invest earlier in life, your retirement goals could take a back seat.
Prepare to Deal with Contingencies
Adverse situations such as medical contingencies could distress you. If you aren't well-equipped to meet the soaring medical costs, it could lead to a cloud of emotional turmoil. You would not want to depend on others for your expenses, isn't it? An effective retirement plan could act as a cushion to deal with uncertainties in the future without depending on others.
Gives you Peace of Mind
A well-crafted strategy is a pathway to securing your dreams post-retirement, providing for contingencies, and supporting your family. This would give you peace of mind and help you lead a comfortable life.
- Set a target retirement age
- Identify your retirement goals
- Calculate the amount you will need to meet these goals. Factor inflation into the calculation
- Invest in the right retirement plan that can help you stay financially prepared to meet your post-retirement goals.
- Your retirement age
- Your health and lifestyle
- Any loans or liabilities
- The retirement goals you may have
- Any commitments you may have to fulfil