Repairing mistakes made in your retirement planning

If you are in your 50s, you must be thinking hard about how you will do in your retirement. Are you worried that you may have made some mistakes in your retirement planning and wondering what to do to fix them ? The author of the article below shows you to check on any gaps you may have left in your planning and what is the best way to repair the same. Check out the suggestions. Team RetyrSmart

Repairing mistakes made in your retirement planning

Delaying Your Retirement Planning

Surveys on retirement planning trends in India have indicated that not everyone pays heed to this important but inevitable reality of life. A survey by a prominent international bank last year revealed that only 33% Indians save regularly for retirement. The rest delay it thinking they still have time to start the process or will start when their income rise. But this is not the right attitude as time may slip by quickly and you may lose the several advantages of planning early. The best time to begin your retirement planning is when you start working. If you have missed that bus, the next best time is now. Do not wait for increments or promotion or for an ideal moment to arrive. Create a plan now, and set your savings account to auto-debit money for investments every month. If time is by your side, you can take risk and choose equity mutual funds for investment. If you’re a conservative investor, go for NPS or PPF.

Borrowing From Your Retirement Fund

One of the biggest blunders young or working people make is liquidating their retirement fund for lifestyle and consumption. Borrowing from your retirement savings (such as EPF, PPF etc.) thinking you will replenish it later means slowing down your own progress significantly. Do not buy depreciating assets such as gadgets or automobiles or fund your consumption or travel with your retirement fund. Remember: retirement planning is a necessity for securing a dignified life when you bid goodbye to your working life. Consumption and lifestyle should be funded through your ordinary income. Investments made for goals such as retirement shouldn’t be diverted for less rewarding pursuits.

Saving Without A Goal

Retirement planning is a goal-oriented exercise. If you are saving and investing for retirement without any goal in mind, you are committing a mistake. Saving without a goal may result in unpleasant consequences like building up an inadequate corpus or depending on debts to meet your necessary expenses. So it is important you first assess your expenses and estimate how much money you will need once retirement sets in. Having an idea about your expenses in your golden years will help you identify the right investment options that can generate a healthy income for you in retirement and help you in preparing a handsome corpus. With the help of a financial expert, choose the investment instruments by factoring in your income, age and risk appetite. You can also take help from various digital platforms that guide you much savings you need to do as per your current annual income.

Not Bought Adequate Health Insurance Cover

Even if you have maintained a healthy lifestyle all through your life, you cannot avoid age-related health risks. Health emergencies can be a drain on your finances, especially in your golden years. Despite this, many people fail to buy health insurance policy to protect themselves from rising medical costs. The group insurance cover provided by your employer is only available till you are working, so do not commit the mistake of relying only on that. If you have bought health insurance plan for yourself, make sure it is adequate and keep periodically topping it up to enhance your coverage with the passage of time.

Depending On Your Kids

In India, it is not uncommon to see parents depend on their children after they start working. It is a common mistake many make. In depending on children, they abnegate their financial independence. By not planning their retirement they also financially and emotionally burden their children. Therefore, plan your own finances and retire peacefully on your own terms.




Disclaimer: The content including advice on this website provides generic information only. Its not been customised for any particular individual or situation. It is in no way a substitute for a qualified and specific opinion whatever be the area viz. health, finances, retirement, lifestyle etc. Always consult a domain specialist for more information. The information is the viewpoint of the author/source and Retyrsmart does not claim responsibility for this information.
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