Nobody likes to retire as we all want to be young and growing till our last breath. It sounds good, isn’t it? But we all imagine the above statement despite knowing that we have to give up our favorite careers at some point in time. Even if your retirement is a long way off, you have to start thinking about how to plan retirement right now to ensure that you can make the most of your savings.
There are various ways of planning your retirement like you might want to clear your debts as you don’t want to have loans over-head when you don’t have a constant income. At the same time, you might also want to save some money for your grandchildren’s education or to build your dream home in your favorite town. There are multiple retirement plans available in the market; hence we have compared a few best options and have listed them below.
- Pen down all your essential financial requirements:
You can start writing down all the financial requirements you will need in your future. Some working professionals aim to purchase their dream car in the future; some want to save for abroad vacation, while some want to save money to ensure that they don’t have to face financial issues during the second innings of life.
- Start saving from the next minute:
According to recent research, salaried people have to save 10% of their annual salary and contribute income to some of the best pension plans in India. If 10% seems like a much larger number, you can start with 1% every year and slowly take the number to 10%.
Some of the best options for saving and investing in India are,
- Pension plans for government employees like 401(k) and 403(b).
- Life insurance plans for individuals.
- Mutual funds.
- IRA or Individual Retirement Accounts (IRA)
The sooner you start, the more you will save.
- Understand your time horizon:
Ultimately, your current age and retirement age will have a severe impact on the plan you select and how your funds will grow for the future. People who have a huge difference between current age and retirement age are the ones who end up saving money. On the other hand, everyone needs to start retirement planning before ten years of retirement.
- Select the investment option wisely:
As mentioned above, there are various ways to grow your money, but you will have to ensure that you select the one which suits your needs and budget. Moreover, you have never to check the water depth with two legs, and the same goes here never depend on a single source of income.
- Watch your funds grow:
Once you have invested in a particular retirement plan like mutual funds or the stock market, you have to ensure that you monitor your risk-reward ratio. You have to also focus more on long-term investing as it demands less risk.
So, these were our five best ways to plan your retirement. Ultimately, the decision lies in your hands; hence you have to ensure that you select the best retirement plan because your financial future depends on the plan you select.