When you’re young and settled, with a stable income, you naturally start planning your financial future. You make investments in the hope of accumulating wealth, and you buy insurance to protect your family. But an often overlooked aspect of financial planning is retirement. There’s no denying the fact that when you’re in your 30s you’re not thinking much about retirement but more focused on your short- and long-term goals and expenses.
But one should not make the mistake of keeping retirement planning on the back burner until it’s too late. The trick is to start early and only then can you accumulate enough funds to lead a comfortable life after retirement. Here’s why you must begin planning your retirement today.
To cover daily expenses
Once you retire, your regular and stable income will cease to exist, and one cannot rely only on savings to cover daily expenses like groceries, utility bills, rent, entertainment expenses and others. If you do that, you may exhaust your savings too quickly, which could be extremely taxing, and you may face a huge financial burden at that age. Instead, you can start planning your retirement today and slowly build a sizable corpus specially to be used for retirement. This way, you can live a comfortable and stress-free life later.
To cover medical expenses
As one grows older, the chances of health issues also tend to grow higher and the most requirement for health expenses come up in the post-retirement age. Medical expenses can go very high, and they may burn a hole in your pocket if you haven’t planned for it. Having a retirement corpus ready means that if the need arises for any medical expense, you can take care of it immediately instead of looking for alternate sources of funds.
To beat inflation
The price of goods and services in the future are certain to be much higher than what they’re now. You must also consider the phenomenon of inflation when planning for your future. With the power of compounding, even a small amount invested regularly from an early age has the potential to grow into a huge corpus. Parked money may lose its value over time and hence you must invest it for it to grow and beat inflation.
To achieve retirement goals
Retirement is an age when one wants to enjoy life. They may want to travel and explore the world, take up a hobby, make their life more luxurious and relaxing etc. If you have a retirement fund, you have the freedom to do exactly that and not worry about expenses. You worked hard your entire life and now is the time to reap the benefits.
To enjoy a stress-free life
When you’re retired, some expenses may come up like your children’s wedding, their education, expenses for a vacation, etc. These expenses can come with a lot of stress since everyone will be looking up to you to manage them. Having a healthy retirement fund means that you can easily carry out these expenses.
Thus, it is imperative that you set plans in motion for your retirement plan today itself for the above reasons. The retirement age is not where you must be stressful or worry about finances. If you plan now, you can certainly enjoy the future to the fullest.