It’s often said that one who plans his retirement much in advance is a wise man, as retirement is one of the important phases of a person’s life. This is important because by the time he reaches that stage he would have many responsibilities piled up. However, retirement also comes with its own share of financial woes and unpredictable measures. If regular monthly income ceases to come by then the problem will aggravate in personal and family life.
The purview of retirement does not exclude self-employed persons and like their salaried counterparts, they too, are bound to feel the burden of a retired life unless they have planned their finances well in advance. Investments made earlier in life, if chosen well, can go a long way in ensuring financial freedom after retirement. In the initial phases of one’s professional life, when expenses are comparatively low, building up a systematic investment structure is very important. Choosing an investment that yields dividends as and when required is also essential. As the career graph moves on, there comes a phase when the volume of investment can be increased. You must always invest more when there is any such increase in earnings.
The cost of living in India is on an upward spiral and this makes us feel the pinch with each passing day. Therefore, it is important to start investing in your future as soon as you start earning. Younger a person is at the time of commencement of relegating funds towards a retirement investment, higher is the term build up and the resulting payout at the time of investment-maturity. Investing a fixed percentage of the income towards the main retirement corpus always helps. One must also be careful not to use any part of the corpus (i.e. the main amount) before retirement.
Cautious About Inflation
Seeking to invest and build up on that investment is important. However, the fact that inflation affects financial planning heavily must never be ignored or belittled. Inflation can make your returns take a plunge and therefore, while choosing any plan, you must make sure that you have taken the futuristic price-rise projections into consideration.
You may not be in the prime of your health in your sunset years and therefore, start early when it comes to building up the financial safeguard in times of emergency. This ensures that your savings and the returns from the investments made by you do not suffer due to medical contingencies.
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