Retirement Planning

Retirement planning is a process of setting retirement income goals and taking all the possible actions and making decisions, which are essential to achieve those retirement goals. Retirement planning includes evaluating sources of income, estimating expenses, and setting up an investment plan or savings plan to achieve the retirement goals by managing the risks and assets.

When you start earning, retirement planning is not an immediate concern. It may be reasonably easy to put it off till a later time in life. Nonetheless, you must remember that it is always in your best interest to be prepared. There may be many life events that are out of control, but the least you can do is prepare for them in financial terms. The same is true for retirement planning.

Each of us has an idea of what our life will look like after retirement. No matter what it is, it requires ample financial support to maintain your standard of life. Retirement planning simply means setting income goals for post-retirement life and determining the steps necessary to achieve them.

A significant part of retirement planning is identifying income sources, evaluating expenses, investing in savings programs, and managing the risks.

To put it plainly, retirement planning means devising financial strategies that will help you save, spend, and invest according to your long-term goals in the later age. There are many financial instruments available that aid in retirement planning, depending on the individual’s profile.

When you have a steady income source, most problems in life become easier to solve. A financial burden can lead to several harmful consequences, including health issues that will only add to your worries.

When you have an adequate understanding of what is retirement planning and how it affects your life, you are better equipped to deal with post-retirement challenges.

While you can begin retirement planning at any point in life, it may be more convenient to do it early. Depending on when you start your retirement planning, your goals may also change. The pace of life today makes it challenging to pause and reflect on the long-term plans at the right time.

Also Read: Benefits of Early Retirement Planning

While a comfortable life may have varying connotations for everyone, the importance of retirement planning remains the same. It is crucial to consider the factors particular to you and calculate the adequate amount for a joyful life after retirement.

Retirement Planning Calculator

Financial security makes most things in life more convenient. Retirement planning provides that surety of being secure in monetary terms throughout life, regardless of employment. Let’s discuss the multitude of such reasons that make retirement planning essential for life.

Currently Indians can choose from a wide range of retirement plans in order to ensure financial security for their golden years. Currently available options include annuity plans offered by life insurance companies, retirement funds from mutual fund companies, unit linked investment plans and the National Pension System. Below are key details regarding these retirement plans in India:

Typically, investments in a retirement plan or pension scheme should be started as part of retirement planning as early in life as possible. The early start to retirement planning means your investments will have a longer time to grow and you will also be able to invest a bigger amount as the accumulation phase would be longer.

After completion of the accumulation phase, the corpus created is used to purchase annuities that would provide a monthly income post-retirement. Additionally, even after being converted to annuities, the retirement corpus would also continue to grow. Depending upon the type of pension plan purchased, the annuity payouts can be life-long or for a limited term such as 10 years or 15 years post retirement. At the end of the annuity payout term, all monthly payouts will cease.

There is no perfect time to start with retirement planning. At different stages in life, your financial profile may look different. However, it is advisable to begin retirement planning in the early years of life. It helps spread the investments over an extended period, thereby reducing the burden on your regular income.

Typically, retirement planning includes three phases of investment, accumulation, and withdrawal. The first phase should start at the age of 30-50 when you can afford to save or invest a fair amount.

It is essential to understand your risk-taking ability in terms of age, income source, and more considerable expenses such as a child’s education, loans, and marriage.

When you are nearer to retirement, the focus should be on availing of the benefits from the assets acquired over time. You can enjoy them in the form of a monthly income or a lump-sum amount on retirement.

Retirement can be an enjoyable time of life if you plan for it well. Investing in a suitable retirement plan at the right time can help you reap incredible benefits. It is vital to choose the right retirement plan according to your requirements. It is a choice that has a long-term and significant impact on your life.

Max Life Insurance offers some of the suitable life insurance plans in India to fulfill your retirement planning goals. We understand the importance of retirement planning in life and strive to provide the best features to suit the needs of every individual.

Different Max Life retirement plans offer a range of benefits such as guaranteed income for a lifetime, flexible payout options, guaranteed benefits transferred to nominees, and many more.

Max Life Forever Young Pension Plan*, Max Life Guaranteed Lifetime Income Plan**, and Max Life Perfect Partner Super# are among the best retirement plans available in India.

As the policyholder, you must consider specific features like premium payment terms, annuity options, and vesting age when selecting a retirement plan. Thorough retirement planning is necessary to enjoy a life of independence and happiness.