How to plan comfortable life after the retirement?

With the increasing life expectancy due to health conscious lifestyle, healthy food diets, fitness along with inflation costs, retirement plan has become a critical part of financial planning in India. While working upon retirement funds, the corpus you build for your retirement should be able to maintain your desired lifestyle. Risks of volatile markets and fluctuating interest rates are the two most important parameters that should be considered in planning. Your day-to-day savings will not be able to help you build the corpus. Thus, the earlier you recognize your shortfalls the better it would be to reach your financial goals efficiently.

To work upon a plan the foremost challenge is to make inflation-proof investments because rising prices will erode the value of money.  Inorder to get the best out of your investment and yet stay risk free, your plan should be in continuous process with an appropriate asset allocation strategy comprising of equities, debt, gold and real estate.

Experts say one’s post-retirement portfolio should be worked upon on the basis of the current risk tolerance level. In India, only 8-10% of working population might have any form of social security so early retirement planning stands important to maintain one’s current living standards. You should look at the risk profile and invest requisite amounts in funds that help generate good returns. Secondly, re-balancing portfolios ensures that the investments do not over-emphasis on any particular asset category. If you sell investments from over-weighted categories and use the money to invest fresh scripts it will help reap profit and escape longevity risk.

Starting early gives lot of benefits in your retirement funds. If you are reaching your retirement age and you have already invested enough money for these days, you could have a much more relaxed future than most of your other colleagues. Remember that your annual income during retirement should be enough to meet your retirement expenses. Therefore, it’s important you gauge the amount well while solving your retirement puzzle. Learn to start from day-to-day expenses such as food and clothing, housing, utilities, transportation, medical, taxes etc. Inflation is directly proportional to your expenses. Also, the needs and requirements will change from year to year. So have all these things into consideration.

For better efficiency the portfolio should be monitored at regular intervals and proper forecasts should be done. You can invest your money in retirement plans, bonds or fixed deposits which gives a regular payout.

While creating retirement funds

•Consider your risk appetite before investing required amounts in products that help generate returns

 

•Invest in products that you understand or consult financial expert for reviews

•Re-balance portfolio to ensure that investments do not focus on any particular asset category

•Your retirement fund portfolio should have two components. One that earns the minimum income to sustain a basic lifestyle through annuity and monthly income

•Start early and focus upon investing in equity stocks. Book your profits well and then move them towards debt oriented funds to ensure secured earnings for retirement.

No one can give you a foolproof investment strategy which will guarantee a stable and peaceful retirement. But there are lots of ways to generate a steady income of money by investing in Retirement Insurance Company which can give a substantial income in the near future.