Whether you are just starting your career or in your last innings, its never to early to start a retirement fund. Use our SIP calculator to figure out how much you need to invest to live the life you deserve post-retirement.
For your dream Retirement Plan, you require a corpus of ₹ in years. Your current investment of ₹ will appreciate to ₹ assuming % rate of return. You will need to accumulate an additional ₹ . To generate this deficit amount, you will need to invest a lump sum of ₹ now or start monthly SIP of ₹ .
For your dream Retirement Plan, you require a corpus of ₹ . To generate this corpus, you will need to invest a lumpsum of ₹ now or start a monthly SIP of ₹ .
*The above investment simulation, based on assumed rate of return(s), is for illustration purpose only and should not be construed as a promise on minimum returns and safeguard of capital. KMAMC is not guaranteeing or promising or forecasting any returns. SIP does not assure a profit or guarantee protection against loss in a declining market. SIP Calculator is designed to assist you in determining the appropriate amount. SIP calculator alone is not sufficient and shouldn't be used for the development or implementation of an investment strategy. KMAMC makes no warranty about the accuracy of the calculators/reckoners. The examples do not purport to represent the performance of any security or investments. In view of individual nature of tax consequences, each investor is advised to consult his/ her own professional tax advisor.
By planning for retirement, you ensure you can maintain your lifestyle as long as you live without struggle or depending upon others. But you might say that you having savings to depend on. Okay, so imagine the life you live right now – the freedoms and luxuries you enjoy. Now imagine not being able to enjoy them because you no longer have that dependable monthly income. Without a retirement plan, you potentially risk running through your saving and then be forced to liquidate your assets to meet your daily needs. Not a nice picture, right?
Retirement planning is the process of appraising your current assets (physical, savings and investments) to determine your potential income sources, estimating future expenses to determine how much funds you will need post-retirement based on your expenses and goals. Once you have these two figures, you can detract the first figure from the second to determine the deficit. Once these steps are completed, you can begin developing a saving and investing plan to ensure a comfortable retired life.
There is no right or wrong age to start planning for retirement but the earlier you start, the more well settled your retirement years will be.
Retirement amounts are unique to each individuals, based on your wants and desires. If you want to travel, you will need more than someone who doesn’t. Similarly, if you have a known medical issue, you will have to budget for a bigger medical fund than someone who is healthy. To calculate how much you need to live the life you want post-retirement you should first, take stock of your assets – savings, investments, pensions etc. and second, calculate all your potential expenses – daily expense, clothing, utility bills, taxes, insurance, investments, splurges and more. Subtract your expenses from your assets to get how much more money you need to save and invest for a comfortable retirement.
P.S. Don’t forget to factor in your life expectancy (how long you will live).
The answer to this question depends on a number of variables such as age, risk tolerance and existing assets i.e. the retirement plan for an individual in their mid to late 50s will be extremely different from an individual at their start of their career.
For example, a younger individual without much responsibility has a higher risk tolerance and can afford to higher-risk investments in the Equity Market while an individual at the end of his career should probably take a lower-risk route with investments in Balanced or Debt Mutual Funds.
When planning for retirement, you need to consider more than daily expense and occasional splurges, things such as
Yes, it has become very important to plan for retirement as India as a whole has undergone a massive cultural shift. Gone are the days of joint families, where the young support the old. Today, we live in a nuclear society and self-support is the new buzzword. Adding to the complexity of the situation is better health care and longer lifespans, which means you not only need to support yourself post-retirement but also for a longer time. Without retirement planning, you run the risk of running out of funds during your lifetime. And even if they have children to depend on, many parents do not want to burden their kids with the extra expenses that might affect their life.
It is better to start planning for retirement early as it gives you the benefit of the power of compounding i.e. your money has a longer period to multiply, thus, maximizing your earning potential and giving you a potentially bigger retirement fund.
Yes, it is better to start planning as early as possible but do not fret if you haven’t gotten started yet. You can undertake the following measures to ensure your retirement fund is sustainable:
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