Plan Your Retirement Right When You Begin Working

'Retirement' is a word that is on the distant horizon for many people in their 20s and 30s. When one is young, there is no time to think of such things as old age and what one's life will be like.

The retirement years of a person's life must be full of peace, freedom from financial worries and ample time to pursue one's interests. However, the reality is the opposite for millions of elders in society: when they retire, they find that they do not have enough savings. They must depend on their monthly pension for subsistence. In many cases, they are forced to depend on their children for shelter and survival.

This stems from a lack of foresight when one is young. Though '60 years' may seem like a far-off number to a 30-year-old person, time goes by so quickly that one is a senior citizen before one realises it. It is irresponsible to put yourself and your spouse in a financially vulnerable position at an age when you cannot earn an income. Planning and saving for your golden years when you are still young will give you the kind of retirement you have always dreamed about.

Saving from the word 'go'

The key to retirement planning is constant saving. When one is single and working, a sizeable portion of one's salary may go towards saving for the future. This practice of saving a part of the salary should become a lifelong habit. It is not to be interrupted for any reason; the savings thus accumulated are not to be dipped into for other expenses.

If your income is sufficiently large, you can invest in property and lease out the space. That way, you have a precious asset that gives you monthly income that appreciates over time. It is also a good idea to invest in saving schemes and life insurance policies that will accrue benefits for the time you are retired.

Whenever you have surplus funds (from a bonus, sale of property, etc) ensure that you lock the money in a Fixed Deposit scheme or PPF. This will take away the temptation to spend the money that you are setting aside for your retirement.

A mistake you are bound to make is to dip into your retirement planning fund to finance your children's education or marriage. A better option is to take a loan for these purposes – they can be paid off by affordable EMIs when you are still working.

Investing in retirement pension plans is the most intelligent option of all. These are plans that offer one the flexibility of deciding their own retirement age. The age of entry for the plan is normally 40 years, so if you decide that you want to retire at 50 years, the policy tenure will be 10 years. The retirement pension plan offers benefits on maturity; the policy holder gets back 101% the premiums paid plus the bonuses accrued. Paying the premiums thus goes towards creating a sizeable corpus for the retirement years.

We all work hard so that we can have tranquillity in the autumn of our lives. Retirement planning at a young age helps to achieve this objective, with complete freedom from financial uncertainties.

I am Sushant P, I have been writing on retirement planning & pension plans since long time. I have been helping people to make their retirement planning in right way, so that they will be wealthy, happy & self dependant after their retired life.

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