5 Golden Tips for Retirement

Written by Guest Blogger
1 · 24 · 18
5 Golden Tips for Retirement | Lifestyle Glitz

Financial planning is necessary to lead a happy and tension-free life post-retirement. Saving is not enough; investment is also required for future wealth creation. For a successful retirement planning, you need to be patient and save regularly in order to have a financially independent post-employment life. Therefore, we decided to share some never seen before tips for retirement.

5 Never Shared Before Tips for Retirement

Here we will give you some useful and successful tips for retirement planning.

1.      Start Early

You should start planning for your retirement as soon as you draw your first salary. People ignore such tips for retirement and realize when it is too late. Most people realize the importance of starting early after they have already retired. In that case, it will be too late. Those who realize the need for retirement planning before their retirement, they have to invest a large amount of money in order to have a decent retirement corpus by the time they retire.  Hence, it is always best to start early as it will let you contribute small amounts periodically to your savings account and the power of compounding will give you a large retirement corpus after your employment days are over.

2.      Start with the 10% of Your Salary

This may the second of five tips for retirement that we have but it is very important. Many Employers get an EPF account opened for their new employees. According to the rules set by the Central Government of India, approximately 12% of your basic salary would go to the Employee’s Provident Fund (EPF) and your employer will contribute the same amount of money to your EPF account. You will receive the entire sum accumulated after your retirement. However, those who do not have an EPF account should also start retirement planning as early as possible. You should save at least 10% of your income for your retirement on a regular basis.

3.      Increase the Amount You Save

As your income grows with the passage of years, you should also increase the amount of money you save for retirement. If you had started with saving 10% of your total income every month, you should increase the percentage based on your salary increment.  Besides saving, you should also start investing for a future growth of your money. Open a SIP account and start investing in a mutual fund. It will give you good returns in the long run.  You should also increase the amount you invest as your income goes up. This is surely one of the rarest tips for retirement that anyone shares.

4.      Never Withdraw Your EPF Balance Before You Retire

It is a bad practice to withdraw from the EPF account. If you are changing job, do not withdraw your EPF account that was opened by your previous employer.  Just fill “Form 13” and submit it to your new employer. By this, you can transfer your EPF balance to the new account. In cases of emergency situations, borrowing money would be a better idea than withdrawing from your retirement corpus. This is where following tips for retirement like one helps a lot. The power of compounding will help you have a huge retirement corpus in the long run.

5.      Buy a Retirement Plan from a Reputed Insurance Provider

This is the last of our tips for retirement but not the least. A pension plan guarantees a steady income flow after your retirement. Hence, a pension plan is what you must include in your retirement planning. There are a number of Life Insurance Providers that offer different types of Pension plans. Among them all, LIC pension plans are the most popular. An LIC pension plan is undoubtedly the best as it offers a number of benefits to the customers. There were 4 very popular LIC pension plans in the market – New JeevanDhara I, Varistha pension BimaYojana, New JeevanNidhi, and JeevanAkshay VI. However, the first two LIC pension plans have been withdrawn last year.

Anybody can purchase this LIC pension plan as it is much cheaper than the plans offered by private insurance companies. There are two types of LIC pension plans available – a deferred annuity plan and an immediate annuity plan. You can choose any one of the two options based on your requirements.

The 5 tips for retirement above are basic and the most important things to keep in mind while planning for retirement. If you do your retirement planning based on the above tips, we will never have to be financially dependent on your children in old age.

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