Gone are the days when the old-age couple could rely on their big families for monetary support. Over the years, the culture in Indian families has changed from joint family structures to nuclear families that stay separate. They also have fewer children who often relocate for better job opportunities elsewhere. Plus, there is pressure to earn more to support a decent lifestyle, leaving very little room to take care of their aging parents. Hence, it is crucial to plan for your retirement without relying on your family for financial assistance.
Retirement means different things to different people. It could be taking international trips with your partner or spending afternoons catching up on your favourite book. However, these much-awaited golden years can only mean relaxation if you are financially secure to live off your savings without any income.
Even though the word ‘retirement’ seems daunting, it also brings a sense of relief at the same time. Imagine escaping the 9-5 grind of the work-life. However, it is also a source of worry for some due to the loss of income that comes with retirement.
The only way to truly enjoy your post-work years is by investing in the best saving plan that will take care of you long after you quit working.
In this article, we will talk about the best savings plan in Indiaand how it will help you spend your retirement in financial ease and comfort. But first, let’s understand the basics.
What is Retirement Planning?
Retirement planning is all about planning your income in such a way that you can lead a good life post retirement.
With retirement planning, you can accumulate enough wealth to help you pay for medical costs, living expenses, and inflation, among other things. If you invest in the best saving plan in a timely manner, then you would still be left enough to pay for old-age emergencies. This is the reason you need to have sufficient corpus to keep you financially stable.
Factors to Consider When Choosing the Best Saving Plan
Since there are so many investment vehicles to choose from, it is normal for a first-time investor to feel overwhelmed. People who has little to no knowledge about savings and investments would not know where to start. Making the wrong choices can lead to financial losses and prevent you from achieving your long-term goals. This is the reason you need to consider the following factors when choosing where to invest your money:
- Age: All financial experts recommend that the sooner you start investing, the more wealth you will be able to create. First of all, young people have fewer responsibilities and higher disposable incomes to start investing immediately.
Secondly, they have a long working life ahead of them, which allows them to invest in instruments that offer returns in the long-term. At this age, equity-based investments, such as mutual funds, would be more rewarding than something like fixed deposits. You can increase the amount of investment as you grow older.
- Financial goals: Investment goals can be both short term as well as long-term. However, for retirement, you must consider long-term investment instruments to create the best saving plan.
- Profile: Keep your profile in mind when you develop a savings plan in India. Things like your income, number of financial dependents, tax deductions, and TDS return are some factors that you must consider.
Steps to Choose the Best Savings Plan
With basics out the way, here are some steps to help you choose the best savings plan:
- Start early: With the cost of living in India being on a constant rise, you need to start investing for your retirement right now. The sooner you start, the higher your tenure will be. resulting in a higher payout at the time of maturity. As your career progresses, you can increase the volume of your investment.
- Set aside a fixed percentage of income towards retirement planning: You must set aside a fixed amount of your income towards the main retirement corpus and take a pledge never to use it before retirement.
- Take inflation into account: Inflationcan heavily impact your financial planning and must be taken into account. When choosing an investment plan, make sure you have considered futuristic prices to choose the right instruments.
- Invest in the right insurance plans: Do account for future expenses when creating a savings plan. This is why you must add life insurance-related products to your savings plan so that you can cover medical contingencies without digging into your savings.
Retirement is a crucial phase in everyone’s life. After spending decades in service, you finally have the chance to enjoy the fruits of your labor. So keep all these pointers in mind and start investing in the best saving planright now!