Saturday, 26 November 2011

Retirement, save regularly for your retirement life

Retirement and retirement life is not a dream, it is a reality. Do you ever think about your retirement life? Thinking about retirement life may not a pleasant thing for many.  Retirement plan should start very much early before retirement age. When you start earning you must start regular saving for retirement living. But how should you save for retirement life or how much you should save for retirement? Some websites provide retirement calculator which may help you to determine your required retirement amount. Prudential retirement, Ing retirement, Nys retirement and so many other retirement plans are there by various insurance companies. Whatever is the plan you must save regularly for your retirement life.

You must set apart a certain percentage of your income every month for your retirement life and invest this money in any good investment scheme regularly. This accumulated money can use for your retirement. But how can you know how much money you need for your retirement life. Most of your financial responsibilities such as education and marriage of your children, buying a residential house etc are almost over when you retire. Then you must meet regular expenses and medical cost in your retirement life.

If you are an employee your employer deduct a certain sum of money from your salary and invests in any recognized saving scheme which helps you to meet your retirement expenses up to a certain extent.  It is  Provident fund, 401K etc as per the country you are working. The employer also deposit almost same amount in the scheme in your account and the interest on provident fund is not taxable as per the current income tax rules. When you retire you can withdraw the accumulated money with interest and can use for your retirement need.

The provident fund amount itself may not enough to satisfy your retirement needs. And those who are not working as an employee they won’t have such provident fund or 401K. In such a condition you must save a certain percentage of your income, say 10% or 20% for your retirement planning. You can invest it in any good investment scheme and can use the accumulated money for your retirement life. If you start earning at the age of 25 years with a monthly income of 20000 bucks and you invest 10% of your earnings every month in any good investment scheme which gives you an average interest rate of 8% and your earnings increase by 10% every year, your accumulated saving will be 1, 72,59,146 which may enough to meet your retirement expenses.

For this you should vigilant to invest 10% (the percentage may vary as per your requirements) of your earnings every month and when your income increases the amount also increase. You may keep the 10% every time and should invest in a single or a few good investment plans. You can invest in Systematic investment plan in mutual funds or public provident fund or any good investment scheme or pension plan. But be strict in this regular saving and do not touch this money for any other financial needs. This keep strictly for retirement life and you can lead an independent retirement life. At the time of retirement you may invest this money in any monthly income scheme or annuities to earn a good regular income.

retirement life & retirement planning 

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1 comment :

  1. [...] How can you survive that time without having a regular income? Need of a complete retirement planning starts here. How can you plan your retirement when you are working? A good portion of employees [...]