Hello Readers!
Pre-planning for retirement expenses becomes more important, as, during your retirement, you do not have a fixed source for a regular income. It can last longer than you think, thanks to medical science achievements, it has increased the average lifespan. The days of retirement can be golden if you are financially well prepared, but they can be black days for you if your retirement planning is not at a place where it should be.
It’s more important than ever to have a realistic retirement savings goal and a solid plan for achieving it.
As per research, it has been observed that around 70% of major problems arise due to a lack of financial support. And when your mind suffers from financial stress, it can force you to take the worst decision.
Thus, if you plan for your retirement at a good place, it does not only give you financial support in your days of retirement but also gift you good mental and physical health.
How To Plan For Your Retirement?
Only saving for your retirement cannot give you a stress-free retirement but creating a good corpus for your expense of 20 years of retirement can give you peaceful retirement days.
A good corpus for retirement can only be created if you put your money at a place where it can grow, where it can earn a good interest for you over a good term of the investment. There are several investment instruments where you can invest your money for your retirement, like Stock Market, Fixed deposits, Mutual funds, and more. But the best-advised investment instrument for your retirement planning can be mutual funds.
For individuals, when they plan for their retirement, it is advised to them, very first decide what lifestyle you are going to live after you retire, modest daily life, or one that will involve a high standard of living? Once you select your lifestyle, now select what life span of retirement you are going to plan, a span that lasts 25-30 years, or more. Ideally, it is advised to plan your expenses for a minimum of 20 years of retirement. Once you have estimated all these, now it’s time to calculate an approx. estimate of your expenses, do not forget to include medical costs and potential long-term care costs.
Now as you have estimated your expenses, your estimated expenses are the corpus that you need to build for your retirement. Fix the term for which you are going to invest, if you 30 years of age that means you have more than 30 years to build your retirement fund. Now you have your tenure of investment and target to reach, calculate your SIP amount per month and start investing in Equity Mutual Funds.
Why Mutual Funds Is Best To Invest For Your Retirement?
Many reasons make Mutual funds the best investment for planning your retirement as compared to others like Stock Market, FD’s, and more.
- Mutual Funds have a variety of schemes with different investment objectives and risks, investors can pick out funds that suit their objectives and their risk profile.
- Mutual funds offer a good interest rate on your returns when carried for the long term. They give returns with interest rates up 12-15% in long term, whereas FD’s give only 7-8%. Although the Stock market offers good returns than mutual funds, at the same time they are riskier than mutual funds.
- Mutual fund offers inflation-beating returns, that is if you plan your retirement with mutual funds, you need not worry about the inflation eating your returns. Be stress-free, as your investment returns are increasing accordingly with the inflation in the market.
- Mutual funds offer tax benefits, which other investments like FD’s and Stock Market offer.
- Mutual funds offer the option of SIP (Systematic Investment Plan) which allows you to start investing with a small amount. That means you can plan your retirement in the early days of your career and can invest for the long term to create a good retirement corpus.
- Also, SIP helps you build a strong portfolio by adding more units to the portfolio in times of the down market.
How Can We Help You In Planning Your Retirement?
Well, as a financial adviser we can help you calculate your estimated expenses for your 20 years of retirement. We can help you calculate your monthly SIP amount to create your retirement corpus. We can help you pick out the Right Equity Mutual Fund, that best suits your objective and your risk profile, so that you won’t get unstable towards your investment when it starts showing temporary corrections. We keep reviewing your portfolio at times and keep evaluating whether your funds are doing as per your objective. We also do necessary changes in your asset allocation as per your goals, but only with your permission, so that your fund can create the required corpus for your peaceful retirement.
Well, every individual needs to understand the importance of their finances and investment. They must understand that to stand out in situations like a crisis, they need pre-financial preparation, and to lead a stress-free, peaceful retirement, they need proper retirement planning.
Experts advise always create an emergency fund, that should be equal to your minimum 6-month salary to tackle the situations like crises, without any hassle. You can look towards investing in a Liquid fund to build a good emergency fund. For your retirement planning, you should look forward to investing in equity mutual funds. It is said it is never too early to plan for your life after you’ve finished your career, you can start developing your retirement plan today.
In case you are having any financial queries and need any kind of assistance on your financial planning or retirement planning, you can talk to us.
Keep reading our articles for more updates on finance and investment!!
For any kind of query you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.
Happy Investing!
(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee to future returns).