5 Ways to Plan for Your Retirement
The golden period should be fun, comfortable and secure. For this one has to commit sufficient time for planning and organizing. In fact, you must start as early as possible to ensure a decent lifestyle in your 60s. This way there are fewer anticipation of dread or fear of finance loss. Instead, you are more likely to spend the leisure time pursuing hobbies, traveling the world or being with your loved ones. For these to unfold smoothly, know your requirements, start saving already and consider multiple investment plans. This will help you kick-start life’s second innings with a bang. Below are a few other ways to ace the same.
1. Gold ETF Funds
Gold is acts as a hedge against inflation and market turbulences. However, besides investing in bars, coins or jewelry, consider ETFs to gain exposure. These have high liquidity and once traded, it is credited with the unit’s equivalent amount in cash instead of the metal. They are quite simple to obtain since the process is similar to selling other equity based funds. Further, gold ETF funds tend to maintain steady and stable returns and are profitable retirement savings option.
2. Determine Spending Needs
Many people are under the impression that expenses are likely to go down post retirement. However, that is far from true. You might have fulfilled most responsibilities but you still want to fulfill your dreams, such as owning an organic farm or investing in a hilltop house. Further, inflation will continue to raise the cost of living, while medical expenses tend to rise with age. So, consider setting aside a fixed budget and try not to retire without a plan.
3. Tax Savings Mutual Funds
ELSS is one of the best tax saving mutual funds. They qualify for tax rebate of up to ₹1.5 lakhs under Section 80C of Income Tax Act. They are also free of capital gains tax for earnings below ₹1 lakh per year. However, try not to act impulsively when there is a loss or gain. Instead, stay invested as long as possible to maximize returns.
4. Emergency Fund
One might try their best to picture the golden years of life beforehand. However, the unexpected tends to happen to everyone. So, try to build a fund for unplanned expenditures. This will keep you from burning a hole in your pocket or wrecking your existing savings. Try not to break into this corpus at present to fulfill your current aspirations. Staying disciplined and consistent will accumulate enough wealth by the time you retire.
5. Start Early
The ideal time to start is in your 20s. If you have not begun yet, do so as soon as possible. The earlier your start, the more time your money has to grow. This power of compounding and can be extremely helpful to fill the retirement pot quickly and efficiently.
Careful steps at the right time will ensure you retirement from work but not from life. Besides the fun activities, you can also pay off debts or sign up for vital medical policies. Work with a financial advisor for best returns.