How old should you be to start
planning for retirement? The answer to this is simple, you should be employed.
If you have a job or you are an entrepreneur, it is important that you start
your retirement planning today irrespective of your age. There is a common
misconception that one should not think about saving for retirement unless he/
she is in the age group of 35-40. Waiting until the 30s will come in your way
of building a strong financial portfolio post retirement. The earlier you
start, the more money you will save. However, retirement planning can be a bit
overwhelming.
In your 20s, you would need a
professional planner to help you with same. And in case you are planning it to
do it all by yourself, we have listed down a few mistakes to avoid. Read on:
Not knowing your needs:
How much money will you need after
retirement? How many dependents you have? What kind of lifestyle do you live?
The sad part is that people start with their retirement planning
without answering these basic questions. Not knowing your needs is the biggest
mistake you will make while planning for retirement. List down your needs and
accordingly set aside the money for saving.
Ignoring healthcare cost:
If your retirement age is 60, you are
most likely to develop one or the other disease. God forbid, if it is a
critical disease, it might cost you savings of a lifetime. Healthcare costs are
increasing significantly. Thus, it is important to keep aside a part of savings
just for healthcare expenses.
Only relying on Employers plan:
Every organisation offers a pension
plan to all its employees. The plan set asides a fixed amount every month and
provides you lump sum money after retirement. As amazing as it sounds, it has
its own limitations. The amount is insufficient to cope up with even basic
needs. Thus, it is important to buy a separate pension plan.
