Retirement Planning

For us Indians from the day we start working we start thinking about our retirement corpus and start saving some part of our income regularly for that fund. May be the ones who have good amount of financial back-up may not worry so much from a very early age, but for the middle-class income group this surely is a priority. We save and we invest in schemes which give good returns. We try to multiply our savings as much as possible. 20 years back when there was no crypto, people would ideally think of investing in real estate, gold, mutual funds, fixed deposits and other such investment schemes.

As we get older expenses also get bigger, there is children's higher education, their wedding, medicals, and your own retirement corpus. All the bigger expenses of life normally come at a later stage of life and if we are not prepared well at that point of time then it can be a trouble. Suddenly big amount of money is just not going to flow into us. Hence a good financial planning is important right from the time we start earning. It's the power of compound interest that grows the money and over a period of time you will see a huge amount of corpus saved.

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For all the major expenses of life we need to estimate the funds required to meet each financial goal and that calculation should be done post considering the inflation % else again that may lead to trouble. From my own experience I am saying. One must have 2 types of savings, one short term and one long term. There are short term expenses like buying some vehicle or spending on some celebrations or a holiday, and there are long term expenses like children's higher education and marriage. Hence savings must also be done in a manner that you do not disturb the savings of your bucketed financial goals.

Savings should be done in a bucketed manner where you know what your goals are and against that you set a corpus and then separately plan for your retirement fund. Many people make mistake they just save considering it all one fund and then they use from that one fund for all their major expenses. In the bargain they sometimes use up the funds of their retirement age also. It is so much important to have financial freedom when we get old and when we do not have a running income. In that time what we have saved for ourself is what matter. In India we do not have any retirement government pension schemes that will support us hence it is for us only to start planning these things right from the time the first income gets into our hand.

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