Retirement is that period of life when an individual is no longer working or is at the commencement of such a period. In case of attaining superannuation or a planned retirement there are no issues but it is worrying when it is unplanned; when the wage or salary is the only means of income; when one's home life is unhappy and working was an escape; when there is pre-existing bad health, according to a Harvard Study.
Post retirement challenges are likely to be to maintain healthy lifestyle; socialize; travel; keep oneself engaged and plan ones finances well to retain pre-retirement life style. The activities undertaken post retirement could be part-time employment, volunteering for a social cause, engage in third full time careers, provide consultancy and last but not least - keep enjoying retired life.
Why Retirement Financial Planning is important? The purpose is to help one to maintain the required lifestyle; to ensure self sufficiency at retirement; provide for contingencies and achieve pending goals, if any. The Financial Challenges faced post retirement include Inflation, Tax on income, Discretionary spending, Healthcare and Personal responsibilities & Issues.
Considering aforementioned challenges one need to ask oneself - Is one ready for the retired life? One can lead a normal retired life, other option is to lead a luxury life and third one is to live a super luxury lifestyle. The choice would depend on the financial planning process adopted in the pre-retirement period. Whether you preferred investments to savings as investments provide higher returns to make you wealthier whereas savings is to keep cash aside or deposit funds in savings account. If one take housing and education loans for meeting goals of House and Child education respectively then it make sense to avail tax benefits. Otherwise it is risky proposition to avail loans for the purpose of investments.
Keep watching this space for more on Retirement Planning!
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