We all are living in present world and often we ignore the future. The lifestyle which we are maintaining in the early days of our career, will we be able to maintain same kind of lifestyle during our retirement days. If you want to live the same kind of life style which you had maintained during early days of your earning, then you need to do planning for your finances. More early you will start planning for your finance, more wealth in the form of savings you will have at your retirement age.
Need of Retirement planning is as much as, as of you wants a vacation to World tour. General mindset of people is they start retirement planning only when they are into the last stage of their career.
Here I am outlying 5 steps, which can help you in having perfect retirement planning:
1. Start early
When the word Retirement comes in mind, the first thing strikes in mind is older age, and that’s the probably reason why people start so late for retirement. If you want more corpus at the end of your job, during your retirement you probably need to start as early as possible in your earning days.
If the same investor had commenced his retirement planning exercise a little earlier, a lot of those complaints against retirement planning probably would have evaporated. So the secret lies in making an early start. We have an illustration on how ‘expensive’ retirement can become for the ‘late riser’.
2. Make a plan
Planning is most important in your life. Planning plays a major role in all small or big works that you do in your life which includes your day to day routines as we as, for future plans. Achieving your targets through planning is the whole sole goal for making a plan.
Before you embark on saving for retirement, you must have a plan in place. While a plan may sound fancy and even intimidating, rest assured it is not all that complicated. Your retirement plan is simply your wishlist of how you wish to spend your twilight years.
3. Consult a financial advisor
Retirement Planning, no doubt requires a high level of involvement from your side. But it also requires involvement of some specialist who can guide you on your investments, where you should invest and for what time you should invest how much amount. This specialist is your financial advisor. Financial advisor can certainly help you in increasing your wealth through your investments. He can guide and let you know exactly wealth or money in terms of numbers which you will have during your retirement.
4. Track and review your plan
Making a plan and the reviewing it to periodically to see what you are achieving is the nest step. You need to see that what has been framed in your plan, you are on the right track to achieve those life goals. This requires effort for your advisor and you need to take a feedback on your financial plan from him on regular basis.
He will actively monitor your investments, exit the investments that are not performing up to the mark and invest in alternative investments. Over time as you approach retirement; he will reduce allocation to risky assets like stocks and/or equity funds in favour of more conservative avenues like fixed deposits.
5. Don’t dip into your retirement savings
If you want to successfully achieve all your goals for retirement planning, you need to show discipline in all your investments. It will require a continuous and disciplined action for your investments. You will require allocating some part of your earnings separately to invest for achieving your retirement goals. Another aspect of discipline relates to treating your retirement corpus as sacred.
One major reason which lets many people to withdraw their money or discontinue their investments is because of the financial emergency, which suddenly comes in life. Your disciplined financial life will require that every time you are confronted by a financial emergency you should not rush to withdraw from investments that are earmarked for retirement. Of course, if there is no way out, then you can withdraw from your retirement kitty, but make sure you make good that withdrawal by putting an equal amount at the next opportunity.