PLANNING FOR RETIREMENT IN 2022? MAKE YOUR FINANCIAL PLANS TODAY!
Are you looking at retirement in 2022? It’s a perfect time to ensure things and finances are in order. Well, it’s more of a to-do list than a must-do list. While it’s a good time to start your mental preparations, there are plenty of things about financial planning as well.
Retirement planning is one of the most crucial aspects of every individual’s financial planning. More than financial planning, it counts as a responsibility you owe to yourself and your family.
Majority of the Indians work as tax paying salaried employees, and hence, the retirement age in India is fixed. Most of us retire by the age of 60 or thereabouts; some even retire earlier than the defined age by taking volunteer retirement.
However, retirement highly differs person-to-person, as every individual has his own take on it. Few individuals may like keeping themselves busy and could work post-retirement or on contrary, they may decide to retire earlier if they are confident that they have invested enough money to live a financially accomplished post-retirement life.
So there is no fixed retirement age – what is important is that the individual has adequate money to meet his post-retirement obligations.
Post-Retirement Income Source
If you are looking for steady income post-retirement, you can consider buying pension plans or take an annuity. You can also invest in mutual funds, equities, bonds, government securities, PPF, FDs, insurance etc.
While you create your portfolio, ensure to diversify it. Have a mix of investment instruments to balance the risk and returns involved.
Do Not Overlook Medical Expenses
That’s the biggest and the most important thing that I tell people as they near their retirement. Medical expenses, particularly for critical illnesses are getting out of reach for a majority of individuals. When you retire, there is no regular income to rely upon. Investing in a health insurance or a critical illness plan simplifies the task of managing medical emergencies.
Take cancer for instance. Treating cancer can be expensive. Cancer affects an individual financially, as well as, emotionally. It shatters a family completely. Unfortunately, most individuals aren’t prepared financially for such an event.
Cost of a cancer treatment in India could vary from Rs.6 lakhs to Rs.10 lakhs, which includes investigations, surgery, and radiotherapy. However, six cycles of chemotherapy can cost up to Rs.20 lakh.
If you haven’t saved enough money, you would have no option other than to break your savings and investments or borrow money as a last resort.
Health plans and/or critical illness plans offer a lot of flexibility both in terms of coverage and disbursal. Health plans cover as many as 30 critical illnesses and over 80 surgical procedures. That’s not all, the health policy continues even after the benefit payment on selected illnesses.