Answer the following:
- How old are you?
- Name important Life Needs that you want to fulfill during your life time.
- When do you think you will be retiring from active work life?
- How much is your current savings?
- How much will you be able to save every month or quarter or year?
- Allocate savings against your life goals: Never club goals, remember horses for courses
- what is the level of your total assets and liabilities : figure out Net assets
- What is your current income?
- Multiply item 1 and item 8
- Divide by Number 10
If your anwer at step No: 10 is less than your Net Assets, be alert and find ways to accelerate growth.
Those who just started to have their first job, there is a great opportunity in waiting.
Those who have mid career needs to re-work the chemistry of life
Those who are nearing retirement needs to find protective investments that will sustain them through the empty nest stage.
The New Pension Scheme offers a lot of opportunities for the first two. There are start-up issues in the NPS, though.The DTC will come as a surprise on you, if you do not plan your investments through the life stages Balyam, Kaumaram, Yauvanam, Vardhakyam and Vanaprastham, leaving the impact painful in the middle and unmanageable in the last two stages.
The last but not the least class, has several fixed income options available today.
Senior Citizen Savings Scheme (SCSS) is a fixed-income product that offers 9 per cent return per annum compounded quarterly. It matures after five years and can be extended by another three years. It, however, comes with a couple of riders: an individual cannot invest more than Rs 15 lakh in it and the investor needs to be at least 60 years old at the time of investment. POMIS or fixed deposits of Banks are also there in addition to MIPs from Mutual Funds.
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1 comment:
Great share on retirement planning. It was inspirational post for me because I haven’t thought about this time of my life but now would soon start planning for it. I am 35 years old and have a decent time span to get well prepared. Moreover I won’t mind consulting a certified financial planner india for that.
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