Take Retirement from Work, Not from Life

‘The end of one thing is the beginning of another.’ Nothing explains this better than the end of work-life, which marks the beginning of a new chapter-  ‘life after retirement.’

Sadly though, many of you who grind yourself throughout your working years, plan nothing for this phase of life. You feel retirement from work would mean just lazing around at home, waiting for life’s closure.

However, retirement gives you time to do everything you always wanted to do but never had time for. This can include everything; from your wish to go on a world tour, to starting your own little pet house or cafe. Whatever it is, life post-retirement should mean that you finally realize all your dreams.

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However, besides time, what you will also need for this phase of life are enough funds. But you think, you have a lot of time before retiring and so you delay investing early.

But to ensure that you have sufficient money by the time you reach your retirement age, the key is to start investing early.

The table below shows the case of two individuals who start investing at different periods.

Age at the time of investing Age till investment is done Monthly investment ROI Accumulated money at 60
Vaibhav 30 60 1,000 8% 15 lakh*
Kaushik 45 60 2,000 8% 7 lakh*

*Approximate values

This table demonstrates that even if you invest a small amount, but start at an earlier stage, you will accumulate more wealth than someone who starts late. So, starting early will always give you an advantage.

Where to Invest?

There are plenty of investment instruments available in the market today. However, the best ones are the ones that help you save tax. So, a few tax-saving investments you can consider are as follows-

  1. ULIPs – This is a single integrated plan that offers both investment and insurance benefit. As a part of its investment component, investing in equity options can bring you more gains as compared to debt.
  1. PPFs – Another long-term investment option is PPF, which is a government-backed scheme. This offers attractive interest rates along with maturity benefit. You can begin your investment in PPF with a minimum amount of Rs. 500, extending up to a maximum of Rs. 1,50,000 in a financial year.
  1. Monthly Income Savings plan – This is another lucrative option which will provide you with monthly income for ten years after completion of premium payment. As a part of this, you will also receive accumulated and terminal bonuses when the plan matures. Moreover, monthly income plan will offer you coverage up to 25 years, meaning your family will receive the death benefit in your absence along with other policy benefits. Reputable insurers like Max Life Insurance also offer additional benefits in the form of rider options such as term plus rider and accidental dismemberment or death rider.

Furthermore, considering the effects of inflation and your increased vulnerability to medical issues at that stage, the monthly income component will help you stay afloat for managing daily expenses. Moreover, the maturity benefit will enable you to have sufficient funds in your kitty, to realize other additional plans.

The minimum age to invest in a monthly income plan is 18 years, which means you can start early with even a small amount and reap great benefits later. Furthermore, you may even buy 4 to 5 monthly income plans over the years to build a large pool of funds for your family and yourself.

Diversify for Better Retirement Returns

To ensure that you can enjoy a comfortable retirement life, it is also advisable that you should not just rely on anyone single plan. Along with monthly income plan or any other instrument you choose, you should even invest in equities that offer inflation-adjusted returns over the long-term. Such diversification will reduce your risk and ensure that you have enough funds to live your life post-retirement to the fullest.

So, don’t wait for your retirement to plan your life thereafter. Plan and invest in all your post-retirement adventures and experiences as early as possible.