Keep these things in your mind during your youth, you will never face financial problems in old age, know this for your benefit.
Business News Desk – Every person has to go through old age one day in life. This is the stage of life in which a person needs rest. But this is possible only if you have enough money to meet your old age needs. For this, it is important that you start your retirement planning at a young age. To start retirement planning, you should understand some important things. If you understand these things in your youth, then old age will be spent in fun.
1. Set a retirement goal
First of all, decide how much money you will need after retirement. This should include your monthly expenses, health needs and whatever else your lifestyle requires. Apart from this, you also have to keep the inflation rate in mind because the amount with which you are living a better life today, you will need more money to live the same life in future. Once you estimate your retirement fund, you will be able to do financial planning easily.
2. Start early
The sooner you start planning for retirement, the better it will be for you. If your salary is low then start investing with a small amount and maintain this investment. As your income increases, keep increasing your investments. The earlier you start investing, the longer you will be able to invest and get the most out of compounding.
3. Choose the right investment option
Now the question is where to invest? To meet your post-retirement needs, you can increase your contribution to EPF through VPF and build a good retirement fund. Apart from this, you can arrange both retirement fund and pension for yourself by investing in NPS. In terms of wealth creation, you can add a big corpus till old age by investing in mutual funds through SIP. Apart from this, you can also secure your future through schemes like PPF, Fixed Deposit.
4. Keep inflation in mind
Even after retirement, inflation will affect your expenses. Therefore, while investing, give priority to such schemes which give better returns than the inflation rate. For this you can take advice from a financial expert.
5. Get health insurance
Health related expenses usually increase after retirement, so do not ignore this expense at all. Take health insurance to deal with these. With this, you get financial help in medical emergency and your savings remain safe.
6. Avoid debt
Whatever loan you have taken in your youth, try to repay it before retirement, so that after retirement you do not have the responsibility of repaying any kind of loan. Doing this will not put any pressure on your retirement savings.
