A Comprehensive Retirement Planning Handbook For You

  • Author: Sankar Nagella
  • 5 min read
  • March 9, 2023
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“ The early bird catches the worm”

“The early bird catches the worm” is one of the best quotes on retirement planning.

This is one of the most relatable retirement planning quotes out there, don’t you agree? This is true even when it comes to retirement planning. As you begin to make money, your early twenties are an excellent time to begin investing. But, most young individuals do not appear to consider retirement preparation. Here are some reasons why you should think again.

Retirement planning is a vital and good financial strategy at an early age. If you start financial retirement planning sooner, you get to deal with any obstacles. Several factors contribute to the relevance of retirement planning in one’s life.

Let us understand what is retirement planning. Understand why is retirement planning important today via this advanced retirement planning guide. There are so many retirement planning guides in India out there. But let Assetmonk break it down for you in the simplest way. Assetmonk gives you an introduction to retirement planning. Also, it lists down some golden rules of retirement planning.

But, what is the definition of retirement planning? What are the features of retirement planning?

What is Retirement Planning or Retirement Planning Meaning?

Retirement is like a long vacation in Las Vegas. The goal is to enjoy it to the fullest, but not so fully that you run out of money.

                                                                    – Jonathan Clements

What is retirement planning meaning? Let us define retirement planning for you in simple language.

Retirement planning means determining retirement income objectives. It also means taking the necessary steps and choices to achieve those objectives. Retirement planning also means pre-retirement planning. It involves reviewing income streams and predicting costs. It also involves developing investments and saving strategies to meet retirement goals. It can get done by mitigating assets and risks.

Whenever you first start working, there are other priorities than retirement preparation. It may be quite simple to postpone it till a later date. Yet, keep in mind that preparation always serves your greatest advantage. Several life situations are beyond your hands. So, the best you should do is plan for them in financial aspects. The exact same could get said for retirement planning.

Everyone has a concept of what their life would be like after retirement. But, adequate retirement financial planning gets required to continue your way of living. Establishing income objectives for post-retirement living is essential. But, the procedures required to meet them are the essence of retirement planning.

Recognizing income streams, monitoring costs, and participating in saving schemes are crucial.  Controlling risks are also an important aspect of retirement planning.

So simple terms, retirement planning involves developing financial strategies. financial retirement planning or financial planning for retirement will enable you in saving. It also enables you in spending and investing per your long-term goals in later life. There are several financial tools accessible to help with retirement planning.

But why retirement planning is important?

Looking to read more detailed articles on retirement planning? Here’s How Real Estate Investment is Profitable For Retirement Planning in India?

What are the types of retirement planning?

Now that we know the retirement planning definition, let us move forward to the next question.

What are the types of retirement planning?

There used to be a single definition of retirement. That was leaving your job one day and starting a life of leisure the next. When you planned for retirement, you need to guarantee you have enough to live in your senior years.

This used to be a one-size-fits-all attitude to retirement. But it is fast changing, And so, is the retirement financial planning that goes with it.

Individuals are leading healthy, longer survive. As a result, fewer individuals seek a retirement of relaxation. Retired people are instead working half-time or starting businesses.  They are also either switching gears for a job with acquired skills and experience to use in new ways.

All this has led to the emergence of new trends in retirement planning.

Three forms of retirement get emerged as a result of these developments. And everyone requires a different retirement planning and savings approach. So, the retirement types listed below cause the different types of retirement planning. All these types of retirement planning are part of financial planning.

  • Conventional Retirement: Conventional retirement is shutting the door of the office and not looking back. One needs to save early and often. It also means responsible investing plus Social Security payments. Save as much to maintain your preferred quality of life over a long retirement that may last decades.
  • Semi-Retirement: Semi-retired individuals quit their profession. However, they work afterward. But, they would work with flexible hours for extra time for other stuff. It allows you to stretch your retirement savings for years with a smaller nest fund. You may reduce or postpone withdrawing your retirement assets.  Do this until the day arrives when you can finally retire full-time. Earning $30,000 a year in semi-retirement can reduce your total retirement funds.
  • Retirement on a temporary basis: Some people opt for mini or small retirements. Short times of relaxation get interspersed by various occupations. You may spend months/ a whole year for traveling before joining work. This needs financial planning that is more detailed. The savings account for retirement never grows as it could. Because the periods of retirement are so short. Retirement savings do not possess enough time for developing and compounding. Since these are not ongoing – and withdrawal start earlier.

Now, we will explain the importance of retirement planning.

Just started retirement planning at 50 or retirement planning at 40? Read How To Fix A Bad Retirement Plan With Quality Investments?

What Is The Importance Of Retirement Planning?

Why is the importance of retirement planning in India? Or why retirement planning is important?

Most challenges in life get easier to tackle when you have a consistent source of money. A financial load can have some negative implications. Notably, health difficulties that will only pile up your concerns.

You need to grasp what retirement planning is. Grasping of the importance of retirement planning and savings help cope with post-retirement issues.

Although you can start retirement planning at any age, it might be more efficient to start early. Your goals may alter depending on when you begin planning for retirement. The current speed of life makes it difficult to halt. It also gets tougher to ponder on long-term objectives at the appropriate moment.

Everyone’s definition of a pleasant existence differs. But, the significance of retirement planning stays constant. One must analyze the aspects that are unique to one. Also, one must determine the appropriate amount for a happy life after retirement.

But why retirement planning is important in India?

What are the advantages of retirement planning? Read to see retirement planning benefits or the importance or reason of retirement planning.

Retirement Planning: Benefits Of Retirement Planning?

What is/are the aim of retirement planning?

What is retirement planning importance? Or what are the retirement planning benefits?

Many things in life get made easier by financial security. Retirement planning ensures financial security throughout one’s life, irrespective of job. Let us go over the several reasons retirement planning is important. Let us see what is the reason for retirement planning. So, which of the following is a reason for retirement planning? All below.

1. Freedom

People get concerned about becoming a liability to their families in old age. It can also get exhausting to be dependent on another person. Retirement planning enables you to live a comfortable life. And thus, not rely on family and friends.

Several people view retirement as an opportunity to fulfill their aspirations. Aspirations that got put on hold owing to more urgent obligations in life. Such fantasies can come true. But you need to invest effort and time into retirement planning.

2. Average Life Expectancy

You may not know it right now, yet existence after retirement is far longer. For instance, a person retires at 60. The typical life expectancy of 70 years to 75 years provides them with plenty of time. They get to oversee their post-retirement money. This is why retirement planning at the appropriate age is so important.

3. Medical Expenses

The expense of medical care is rising with every coming day. Medical emergencies can devastate a person’s savings. Moreover, as people become older, they become more prone to diseases. Retirement planning is critical for meeting and receiving appropriate medical care when needed.

4. Tax Reduction

Did you know that you could do tax planning for retirement? One can incorporate tax planning in retirement. Every working person wants to cut their tax burden and increase their savings. The Indian government permits various tax breaks on a variety of financial products. You might use it in your retirement planning strategy. It is an efficient approach to prepare for the future while also cutting costs now. Tax advantages are subject to vary based on current tax rules.

5. Ease of Mind

Your ease of mind is priceless. The strain of handling money to fulfill short-term and long-term needs gets excruciating. It may even result in health problems like hypertension and other terrible conditions. It is more necessary to protect oneself against such problems as you become older. Retirement planning is an efficient strategy for guaranteeing a long and fulfilling life.

6. Put money aside for a stormy day.

You’ve heard the fable about the grasshopper and the ant. The ant labored and loaded up on provisions for a rainy day. But, the grasshopper only sat in the sun for a little while. We all know who got the last laugh. Retirement planning enables you to accumulate a retirement reservoir or corpus. A retirement corpus can provide you with peace of mind at any point in your life. Retirement insurance or fund should only get used as a last option. But, it might get pledged to get a short-term loan in an emergency.

7. The Role of Compounding

You offer your money extra time to multiply if you start young. In fact, Einstein referred to compounding as the world’s eighth marvel. “He who understands it earns it… he who doesn’t… pays it,” he stated. A rapid start allows you to save modest sums.  You will also accumulate a large corpus. You will get better as opposed to someone who starts late, even if he contributes more.

8. To combat inflation

Is there an impact of inflation on retirement planning? Yes!  But how does inflation affect retirement planning? Inflation gets defined as an increase in the pricing of goods and services. It depreciates your money’s purchasing power or worth. You see, the price of products and services has been rising. And it will keep rising until you meet retirement age. It means that later, you will have to pay more for everything. Everything from groceries to travel to lodging will cost you more in the future. It would be hard to meet all your retirement goals without solid retirement planning. You need to strive to generate a suitable retirement corpus.  Take into account inflation, life expectancy, rate of return, and so on. So, take account of inflation for retirement planning.

9. To achieve your retirement aspirations

Retirement planning goals are one of the many reasons for retirement planning. They are the aims you want to do throughout your retirement years. These might include traveling or pursuing activities you’ve always wanted to try. But, you do not prepare for and save for all your retirement goals during your working years. They will not become a reality during your retirement years. So, it is critical to establish solid retirement planning. It will inform you of where you are today and what activities you need to take to meet your goals.

As seen, there are tons of advantages of retirement planning.

But, are there any disadvantages of retirement planning?


But, when should you start planning for retirement? Or when should retirement planning begin?

Retirement Planning: When To Start Planning For Retirement?

Now we have seen the benefit of retirement planning. When should you start planning your retirement?

There isn’t any ideal moment to begin retirement planning. Your financial status may change as you progress through life. But, it is best to start retirement planning when you are young. It allows you to spread your investments over a longer period of time. Thus, minimizing the strain on your monthly income.

Retirement planning usually consists of three stages: investment, accumulation, and withdrawal. The first stage should begin between the ages of 30 and 50 when you are able to afford to save or invest a reasonable sum.

It is critical to test your risk-taking capacity in relation to your age, and source of income. And also take into account larger costs like a child’s schooling, debts, and marriage.

As you get closer to retirement, you should concentrate on retirement planning. Via strict retirement planning, you would get to reap the rewards of the assets. You can get them as income for every month or as a single payment after retirement.

Retirement planning by age Is also a must.

What Are The Most Effective Retirement Planning Strategies?

It is critical to comprehend why so many people struggle and fail at retirement planning. One major factor is that they begin late.

People are sometimes unable to save the necessary money for their retirement. They can only donate a part of it. So,  they get forced to postpone their plans.

This, in our opinion, is the incorrect strategy.

Rather, the best route to take is to start with what you currently have. And then compensate for the difference afterward. Yet, if you wait for an ‘opportune’ time, it may be too late by the time you begin.

A reason for not starting is that a large part of the money gets spent on maintaining a current lifestyle. Maintaining a lifestyle like entertainment and shopping sprees leaves little for retirement. So, retirement lifestyle planning is very much crucial.

Although the necessity of meeting immediate needs cannot get overstated. It also makes sense to plan for the future. In an ideal world, one should attempt to find an equilibrium between the two.

Consider creating a solid retirement plan and investing for the inevitable – retirement.

Turning a blind eye to this will only make matters worse. Embracing retirement as a possibility and being well-equipped for it is the answer.

Starting early is your greatest bet for getting prepared!

There are a few retirement planning process steps or retirement planning steps.

Also, there are many investment options for retirement planning for you out there.

Retirement Planning Procedures or Process Of Retirement Planning

“How to do retirement planning?” and “How to do retirement planning in India”.

These are one of the most asked retirement planning questions.

Below are the processes of Retirement Planning that you need to consider. Here is what you have to think about planning retirement tips. But, how to start retirement planning?

Step 1: Establish Your Age Of Retirement

The first step to retirement planning is to establish your age of retirement. It is one of the most crucial stages of retirement planning.

The average retirement age is 60. Yet, retirement planning for an individual varies from another. Several people may choose to work past 60, while others may want to retire at the age of 55. Determining your age for retirement is a vital step. Since your steady income source will stop or get reduced beyond this age. You will have to rely on your savings and assets to meet your retirement needs. This is also the amount of time you have to plan for retirement. For example, if you’re 30 years old and want to retire at 60, years to retirement = 60-30=30 years.

The rate of life expectancy is significant when determining your retirement age.

According to World Life Expectancy, the following is an anticipated life expectancy:

AgeLife ExpectancyAgeLife Expectancy

These are illustrative statistics to help you in retirement planning. For example, if you are 30 years old, you may anticipate that you’ll live for up to 75. And, if you want to retire at 60, you should budget for 15 years of post-retirement living.

Step 2: Begin Early To Retire In Peace

Begin preparing for retirement asap, just like you would any other goal. With several years under your belt, you possess time and the magic of compounding on your side. Never put off retirement planning because you may have to sacrifice your aim. In the worst-case scenario, you may have to rely on your kids or relatives for financial support. As a result, inculcate early retirement planning and begin now. Most people in their twenties who have recently begun working may believe that retirement is a faraway future. For many, budgeting for retirement at this young age may appear unnecessarily conservative.

However, it is vital for you to grasp that being young affords you a luxury that is not given to everybody, ‘time’. “The early bird gets the worm,” as the saying goes. Starting an early investment in life will allow you to collect the requisite corpus without much concern. It also provides you with a sense of security.

Also if you’re in your 30s and have not yet begun retirement planning, it’s still not too late. You still have a lot of time to work, generate money, and save for your peak years. However, be cautious and distinguish between your necessities and desires.

Step 3: Calculate Your Retirement Fund

What is retirement fund planning? Or what is the need of retirement planning fund calculation? Retirement fund planning or retirement corpus planning is the planning of the quantity of money you need after retirement to fulfill your costs, maintain your livelihood, and possibly explore other personal ambitions. To begin, determine your current yearly costs.

To get there, you must first record your monthly spending in areas such as housekeeping, healthcare, leisure, transportation, EMI, and kid’s education fees, among others.

As a result, it is critical that you develop a precise estimation of how much money you will need to sustain your current lifestyle once you retire.

Next, take inflation into account to determine the total amount your current spending will be when you retire. This gets known as the future worth of money. Taking account of inflation in retirement planning is one of the most important steps. Yet, many people ignore it.

This represents the annual amount you will require to cover your post-retirement costs.

For example, Mr. Joe is 35 and intends to retire at 60. He pays Rs. 75,000 monthly for housekeeping and other costs. He also pays around Rs. 5 lakhs annually on vacation and healthcare.

He expects 7 percent annual household inflation before and after retirement, 10 percent annual travel and medical costs, and a 6 percent annual return on his retirement corpus once constructed and invested after retirement.

How much money will he have to retire and sustain his present standard of living?

More than Rs. 29 crores.

Is this feasible?

It is, indeed. Your retirement planning advisors or retirement planning consultants can assist you with retirement planning. He can also establish your asset allocation depending on your risk level, choose suitable investment strategies within each asset class, handle your cash inflows with the rigor required to invest, and periodically monitor the portfolio to ensure that you are on the path to achieving this critical financial goal.

Step 4: Determine the Present Value of Your Existing Savings

Determine the Present Value of Your Existing Savings is the 4th step of retirement planning. How much can you save each year after deducting all of your costs is critical in growing your retirement corpus.

Your savings account is the amount left over after subtracting your yearly expenses from your net pay.

The optimal approach is to set aside a percentage of your money for retirement. This portion of your savings should get considered sacrosanct and should never get disturbed until absolutely necessary.

After evaluating how much you can save each year for retirement corpus, the very next step is to determine its future worth.

You must consider the projected return rate on your investment to estimate this. This is the total value of your retirement savings or investments.

For example, if you can save Rs 100,000 every year for retirement and invest this money in a vehicle that generates a 10 percent annual rate of return, you will end up with a retirement corpus of around Rs 9,834,706.

Step 5: Reduce Extra Expenses

Reduce Extra Expenses is the next step to retirement planning. It is one of the most important things to consider for retirement planning. If you can’t save right now to meet your goal, cut back on unnecessary spending. Avoidable costs include daily leisure, impulse purchases, eating out, international vacations, and so on.

Step 6: Develop An Optimal Portfolio With The Assistance of  A Financial Planner

You should designate a regular allocation to every asset class based on your present age and the risk you can afford to accept.

It is critical to have a well-diversified investment portfolio across asset types.

Several assets, such as stocks, can yield a higher return which gets adjusted with inflation over fixed-income instruments. Gold may get used as a store of wealth and as protection in your portfolio.

If you notice a rapid rise in an asset class and a divergence in the allocation of assets, you may get rebalancing on time by enjoying the rewards of the appropriate asset class and shifting it to different asset classes.

Remember that not every asset class gets suited for you. In the meantime time, you should avoid being overly concentrated in a particular asset type.

Because retirement planning is a time-consuming process, enlisting the assistance of a financial planner can be beneficial. However, choose an autonomous, fair, impartial, and professional financial adviser who will guide you through every stage of the retirement planning process.

Step 8: Maintain And Evaluate Your Plan On A Regular Basis

Your retirement plan or retirement planning should get reviewed on a regular basis (a minimum once every year) to ensure that you are on track to accomplish your goals. Any modifications in income, costs, retirement age, and so on must be accounted for in the retirement plan.

Also, ensure that planning retirement fund fulfills your financial goals in a changing market condition.

Utilize a retirement planning calculator

A retirement planning calculator or retirement planning calculator excel is a useful tool that tells you how much money you will require after retirement. It assists you in planning your investments so that you will have the necessary retirement corpus when you retire. The retirement planning calculator will have two main functions. It displays the amount of money required to maintain your present standard of living after retirement.

The early retirement planning calculator with inflation includes a formula field where you may enter your current age, the age you intend to retire, your life span, and the income every month you will require in retirement. You must also choose the predicted inflation rate (a decent approximation is 6-7% each year), the anticipated investment return, and whether or not you have set away any funds for retirement.

The retirement planning calculator will display you the yearly income required for retirement, the additional funds required for retirement, and the monthly savings required to construct the desired retirement corpus.

There are several retirement planning calculator India like ClearTax Retirement Planning Calculator.

What are the best retirement financial planning calculators? The best retirement planning calculators are MaxiFi Planner and Rowe Price Retirement Income Calculator.

Retirement Planning Errors to Avoid

What are some retirement planning mistakes to avoid? Or what are some factors affecting retirement planning? Below listed are some retirement planning rules to follow.

Per the HSBC report titled ‘The Future of Retirement Healthy New Beginnings,’ 61 percent of India’s working population aged 45 and up would desire to retire within the next five years.

But, 14 percent feel they will be unlikely to do so for a variety of reasons, one of which being a lack of financial stability. So, retirement planning India or retirement planning in India is crucial. So, below are some retirement planning tips or errors to avoid.

These are also golden rules for retirement planning and three main aspects to retirement planning.

If any of this sounds similar, you are most likely making one of the following errors when planning retirement. Take the following inf into account for successful retirement planning.

1. A Late Start

The cardinal rule of retirement planning is to begin early and continue to invest. For retirement planning,  the thumb rule is very crucial. This gives your money additional time to expand (between the present and retirement).

Take the following example:

FactorsCase 1 – Early StartCase 2 –  Early Start
Age of Starting3045
Age of Retirement 6060
Number of Years Investing35 years15 years
Investment per month (Rs)25005000
Total Invested Amount (Rs)900,000900,000
Assumed Return Rate 8 percent8 percent
Value of Fund at Age of Retirement (Rs)35,21,36716,88,031

The instance strongly demonstrates that, despite the same amount of investment, the Value fund at age of retirement is much more than twice that of a late start.

2. Insufficient Savings

“Earnings – Savings Equal Expenses” is another golden guideline for making investments. That’s correct. Make saving money a top priority. You are unlikely to have substantial liabilities when you are just starting out in your job. The majority of your money may be prudently saved and invested. Make a goal to begin saving consistently now.

3. Savings are not being increased

Benefits, incentives, and increments are awarded as you advance up the career ladder. Maintain a consistent rise in your contributions to your retirement account over time. Several retirement plans, such as the Max Life Forever Young Pension Plan, enable you to save gradually by contributing an extra 5 percent Top-up premium per year for the duration of the premium payment term.

Now let us look at the top retirement planning investments for you in 2023.

Best Investment For Secure Retirement Planning

Planning for retirement in India? Have you also been looking for ways of planning retirement income since pension retirement planning aren’t enough? Or what are the best investment vehicles for financial planning for retirement in India? Below are the best retirement planning vehicles and investments for retirement planning for women.

  • Real estate

A suitable instrument for retirement planning is real estate. Real estate is typically a solid investment option for retirement planning or retirement income planning. Real estate is a very profitable asset type. It is also widely used as an inflation hedge. Capital appreciation and rental income are two other important benefits of real estate investing. Real estate beats other asset classes on a regular basis and is less volatile than other investment options. If the client has adequate liquid and regular income-producing financial assets, it might be another asset category for retirement income planning. In addition, rental income from real estate is an inflation-adjusted source of income. Furthermore, the income is known ahead of time, making it simpler to prepare for and use. Real estate is the best investment for retirement planning India. It can also very much get used as a post retirement planning investment vehicle. 

What makes real estate holdings such an important component of retirement planning investments? Infact, many experts suggest real estate as part of their retirement planning advice. But why  is real estate the best advice on retirement planning investment vehicle?

  1. Real estate properties build up to bigger prices over time while being less hazardous and fickle.
  2. Investing in many properties will help you reduce risk and diversify your portfolio while also providing consistent income flow.
  3. If the real estate market has a downturn, it is usually a passing phase. The industry is very elastic, with few setbacks.
  4. Capital returns are the most profitable of all returns. The property’s value will rise over time, and when you choose to sell it, you’ll be able to command bigger profit margins.
  5. Finally, real estate is one of the best tax planning strategies for retirement. Investors may reap the benefits of many tax breaks when purchasing a home. If you take out a house loan, you can save up to Rs. 1 lacs each year on the principal amount. Investors can receive a tax credit of up to Rs. 2 lacs if it is a shared property.
  • Stocks

The bulk of savers still buy stocks as part of retirement planning investment, which is shares in a publicly traded corporation, whether direct or via a mutual fund or exchange-traded fund. Stock prices typically rise over time, which is why people invest in them. Per the S&P Dow Jones Indices, the S&P 500 has averaged a 10.24% yearly return with reinvested dividends since 1926. If you invest in stocks in your 30s and retire in your 70s, there’s a good chance your money will have risen in that time. Stocks account for at least 65 percent of the assets in equity mutual funds (MFs). Many are planning for retirement using mutual funds. They invest in stocks because they surpass fixed-income instruments and inflation over the long term. They are perfect for individual investors who wish to invest in equities but lack the necessary knowledge or time. Equity funds are further divided into a subset known as Equity Linked Savings Schemes (ELSS). They are tax deductible under Section 80C of the Internal Revenue Code. At three years, these funds likewise have the lowest lock-in term of any Section 80C alternative.

  • Systematic Investment Plans (SIP)

SIP for retirement planning is one of the finest retirement planning investments or retirement income planning. SIP allows you to put money in a mutual fund scheme of your choosing from your monthly savings, based on your financial requirements and risk appetite. SIPs may be a responsible form of investing because they force you to restrict your expenditure and contribute on a regular basis. SIP is one of the most effective methods of investing in mutual funds for retirement planning. SIPs are commonly used by private sector employees to plan for retirement since they enable them to create and compound wealth in an affordable manner. SIP is a method of mutual fund investing that is systematic. A minimum deposit amount is not set for SIPs. If you contribute Rs.1000 to SIP on a monthly basis, you may build a corpus of Rs 3 Crores across various investment tenures assuming a 12 percent annualized return on investment. You can see that the potential of compounding is immense over longer time periods.

  • Bonds

Bonds is yet another investment for retirement planning for savers since their prices fluctuate far less than stocks. Investors give money to the government or a firm in return for a yearly payment with a fixed interest rate. You get your initial investment back at the end of the bond’s tenure, which is normally between 1 year and 30 years. Bonds are popular as retirement planning investments among investors for 2 reasons: they provide a definite yearly income and, based on the type of bond purchased, there is a reduced chance of losing money. Since bonds vary less than stocks, they aid in evening out the total downs and ups of a portfolio. Tax-free bonds are long-term bonds with maturities ranging between 10 years to 20 years. It is an excellent retirement planning investing strategy that outperforms borrowed funds and FDs.  These are ideal for consumers seeking consistent income during their retirement years.

  • Mutual Funds

Mutual funds as retirement planning investments provide versatility and possess the ability to provide higher long-term returns. Retirement planning using mutual funds gets done by many people. Mutual funds get chosen when it comes to investing choices for financial objectives because retirement planning is largely a long-term planning area. Mutual Funds for Retirement are much more tax-efficient than pension schemes. There are no exceptions to the general rule that pension income is taxed in the same manner as ordinary income. Capital gain that is long-term in equity mutual funds gets zero tax up till Rs. 1 lac, but in debt funds, they are payable after indexation, which usually reduces the tax to zero.

What are the best mutual funds for retirement planning? In fact, there isn’t just one best mutual fund for retirement planning. There are multiples for you to choose from. Below are the best retirement planning companies for mutual fund schemes.

Name of the mutual fund
HDFC Retirement Savings Fund Equity Plan Direct-Growth
ICICI Prudential Retirement Fund Pure Equity Plan Direct-Growth
HDFC Retirement Savings Fund Hybrid Equity Plan Direct-Growth
ICICI Prudential Retirement Fund Hybrid Aggressive Plan Direct-Growth
Tata Retirement Savings Fund Progressive Plan Regular Growth

Employees’ Provident Fund (EPF) has legislative backing since private enterprises with 20 and above employees are required to contribute a portion of their pay to this retirement saving. As a result, it is one of the most popular employee retirement planning and savings alternatives. So, what are your odds of getting a sustainable retirement fund if you just rely on EPF for retirement savings? If no one withdraws from EPF, it will grow into a significant corpus. If properly invested, one can get a reasonable income from a variety of sources. It does not have to come from pension products.  For example, if you started your career at the age of 25 with a base salary of Rs 25,000 and your payment has grown at a rate of 5% per year, the balance of your EPF at the time of retirement at 60 would be adequate to get a government employees’ pension. You would be able to obtain a monthly income of Rs 1.85 lakh, which is half of your previous monthly pay of Rs 3.7 lakh, and it would rise each year, lasting 30 years in retirement until the age of 90.

Also read Early Retirement Investment Plan For Salaried Employees.

While EPF may be adequate for some, it may be insufficient for many paid individuals. Greater pay growth means that your final drawn salary will be considerably higher, requiring you to have a much higher monthly income and so amass a lot larger retirement corpus. This is where another retirement planning and saving mechanism, the NPS, comes into play. For example, if you started work at the age of 25 with a base income of Rs 25,000 and it increases at a rate of 10% per year, the retirement corpus required for a govt employee like pensions would be Rs 9.75 crore (See the table). However, your EPF corpus will be merely Rs 4.73 crore. In this case, if you contribute Rs 5,441 a month in addition to your EPF deduction and increase it in proportion to your income growth, you would be able to build a retirement corpus of Rs 5.02 crore via NPS if the annual return is 9%. There is zero substitute for the tax savings opportunity provided by NPS contributions. This becomes an efficient instrument for persons with higher tax rates to not only augment their retirement savings but also enhance them. So, NPS are one of the best retirement planning schemes in India. Extra and exclusive tax deduction advantage of up to Rs 50,000 per section 80CCD for NPS investment helps to increase overall returns, particularly for those in the most taxed bracket of 30 percent. So, you can add NPS for financial planning after retirement too.  It can also get used as an investment vehicle for planning after retirement.

A huge proportion of people either have no EPF savings or have relatively low balances in the middle of their careers. In such a case, further investment in a voluntary provident fund (VPF) might be quite beneficial. VPF is an excellent addition to a user’s portfolio and savings, particularly for investments. We know that a certain level of fixed income or debt is beneficial in asset allocation for retirement, and VPF fills that role extremely effectively in the portfolio. Furthermore, because it is a long-term debt investment with a tax advantage and a reasonable interest rate in the present circumstances, it is a smart retirement planning idea to explore VPF  for retirement planning.

  • Alternative Investments

For good reason, a portfolio of 60% equities and 40% bonds had a “golden era” from the 1980s until recently. The blend regularly offered investors appealing risk-adjusted returns, with total returns that were typically similar to or greater than the S&P 500 Index and with reduced volatility. Stocks and bonds benefited from low-interest rates and lower-than-average inflation. But, persistent inflation and rising recession worries have hammered markets in 2022, creating significant headwinds for the 60/40 portfolio.  However, market circumstances have fundamentally shifted: interest rates are increasing, and inflation is at a four-decade high. Per a recent Morgan Stanley research, a 60:40 portfolio of US stocks  and the Aggregate Bond Index lost about 16% of its value through June 30th, wiping out all 60:40 gains since September 2022. Data reveal that portfolios throughout Europe faced a similar fate. In India, a 60:40 portfolio comprised of the S&P BSE 500 index and the S&P BSE India Bond Index is also in the red, but it is faring significantly better than its worldwide peers—-2% as of July 31.

There are several alternative investments to consider. Alternative investment methods, such as those centered on hedge funds, private money, and real estate assets, have long been viewed as a possible source of greater yields, reduced volatility, and returns that are uncorrelated with stocks and bonds. Most experts advise investing 5% to 10% of assets in alternative assets for retirement planning. Gold is a famous investment since its price rises during recessions and major market dips. Based on your degree of understanding, you may also invest in other commodities such as oil or silver, as well as futures and options. Before making any out-of-the-box investing decisions, consult with retirement planning specialists.

  • Annuities

Retirement planning annuities are one of the best investment vehicles. An annuity is an attractive retirement planning tool with stages. Upon investing a lump sum deposit, an annuity plan offers you with assured recurring income for the remainder of your life. The life insurance company puts your money in and gives you back the profits. Consider it similar to a pension payment paid to you. Simply specify whether you want your pension paid monthly, quarterly, semi-annually, or annually.

  1. Receive a guaranteed regular income
  2. Receive a regular income for the rest of your life
  3. Select the periodicity of income – monthly, quarterly, half-annually, annually
  • Unit Linked Insurance Plans (ULIP)

One can also include insurance for retirement planning via ULIPs. ULIPs, which are intended to be long-term investments, can be effective investment planning for retirement. ULIPs provide strong returns while also helping to fight inflation. You may also select the funds in which you wish to invest based on your risk tolerance. Thus, ULIPs enable you to accumulate sufficient wealth to carry you throughout your retirement years. Furthermore, ULIPs include a life insurance policy to protect your loved ones. ICICI Pru Signature is a ULIP that allows you to switch between funds of your choice without incurring any deductions or extra costs. This boosts your policy’s benefits. Other benefits include

  1. Return of some expenses, such as mortality and fund management fees towards the conclusion of the policy period, so increasing earnings
  2. Increases to your fund units via wealth boosters
  3. Systemic withdrawal strategy to address short-term funding requirements
  4. Option for entire life insurance to preserve the financial well-being of dependents after retirement

With such a wide range of retirement planning investing possibilities, one is bound to discover instruments that meet their aims and aspirations. Ensure that you choose the correct investment opportunities by researching them thoroughly.

Affordable Ways For Real Estate Investment For Retirement Planning

Have Been planning for retirement income? Real estate was initially only an investment vehicle for retirement planning for high-net-worth individuals. But, now even average individuals can invest too.

These are the affordable and best ways of planning retirement income for you.  You can invest in retirement estate planning via the following ways. These can also serve as the best vehicles for retirement planning for young adults.

  • Fractional Ownership

A new type of property ownership, fractional ownership of property, allows people to obtain ownership of a piece of property they have been pursuing for some time in a more simple and cost-effective manner. The three hallmarks of good investment planning for retirement are investment safety, strong returns, and consistent monthly rental income. Per the statistics, fractional assets have an IRR of 13 to 20%, which is higher than the IRR of most retirement plans. In comparison, schemes and bonds provide only 7-8% returns, which are significantly lower than commercial real estate profits. Commercial lease arrangements often tie tenants up for 5 years to 7 years, with a 15  percent rental revenue rise every three years. , fractional ownership are one of the great options for retirees looking for a steady rental income. Experts agree that fractional ownership of commercial properties are a low-risk, high-return investment for any retirement plan. One can put up to 25% of his assets into fractional ownership in order to produce steady capital gains and rental income. This can also be a great investment vehicle for retirement planning for couples. 

Also, read 6 Reasons Why Investing In Fractional Property Ownership Is The Best Retirement Plan.

  • Real Estate Investment Trusts or REITs

For better retirement planning one should invest in real estate via REITs. REITs are the best investment for retirement planning for two primary selling points: they consistently improve in value and produce rental income. REITs are a simple way to invest in real estate. They have a unique tax situation that requires them to release at least 90% of their profits as dividends. Investors of REITs would generate rental income, profits from properties that get sold, and securities loan payments backed by a mortgage. These REITs generate capital gains. But the dividend income generated every month is the primary draw. They avoid corporation taxes by distributing at least 90% of profits to shareholders.

Also, read Exploring REITs? Here Are The 3 REITs Listed In India & How To Invest.

  • Real estate crowdfunding

Crowdfunding is investment planning for retirement the grouping of capital by a group of investors into real estate projects. Firstly, investors profit from rental revenue. CRE investment was previously exclusively open to experienced investors. Even so, these platforms have since expanded to allow anyone to participate. As a result, crowdfunding has reduced the barrier to investing in commercial real estate. Real estate crowdfunding permits an investor to invest in high-end developments of commercial real estate projects with zero management of the property. In most cases, an operator controls the property that gets crowdfunded. What is left for investors is producing funds to support the initiative.

Also read Real Estate Crowdfunding: An Unconventional Path to Investing In Commercial Real Estate.

Conclusion For Retirement Planning?

Planning for early retirement? Everybody fantasizes about the day when they will be able to say their final goodbyes to the job and retire. However, this comes with a cost. This is where retirement planning enters in. And it makes no difference where you are in life. You may receive Social Security payments, but they may not be sufficient, especially if you are accustomed to a specific lifestyle. Setting money away now means having less to worry about later.

A well-timed and smart retirement planning goes a long way toward ensuring your desired retirement lifestyle. 

“Preparation for old age should begin not later than one’s teens. A life which is empty of purpose until 65 will not suddenly become filled on retirement.” says Dwight L. Moody.

So, start investing in real estate today for retirement planning for a healthy, rich, and tranquil retirement with Assetmonk. Assetmonk is also a retirement planning company and the best financial advisor for retirement planning. How is it the best? It offers the opportunity to purchase institutional-grade commercial real estate. It helps you generate monthly rental income and capital appreciation.  Assetmonk has a comprehensive research process for people wishing to invest in commercial real estate without the hassle of managing physical property. Assetmonk allows you the benefit of doing retirement planning online by investing in real estate and checking your investments via a dashboard.

You can also invest in Assetmonk’s commercial real estate retirement planning products via fractional ownership and crowdfunding with just Rs.25 lacs.

Now, that we have given you a retirement planning 101 guide and also retirement planning real estate, it is time for you to start investing.

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