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3 Mistakes You Must Avoid When Planning for a Successful Retirement

Nov 26, 2019 | 4 months ago | Read Time: 3 minutes | By iKnowledge Team
3 Mistakes You Must Avoid When Planning for a Successful Retirement

Everybody wants to retire early, but very few want to work for it. Even people who have worked hard for early retirement end up making costly mistakes which leave them in the same bracket as their unplanned buddies – a stressful retirement. Life after retirement is presumed to be easy and relaxed, but without a proper plan and direction, it can take a turn for the worse. If the planning is inappropriate, retirement can become much troublesome instead of peaceful.

According to HSBC’s study titled, ‘The Future of Retirement Healthy New Beginnings’, “Though more than two-thirds of the people in the age group of 45+ would like to retire in the next five years, retirement is out of reach for 2 in 5 workers.”

The primary reason for their inability to retire lies in lack of planning. 14% people over the age of 45 believed that they could not retire because of various reasons and among those, financial security was the biggest. Perhaps even the best of planning backfires and is financially detrimental down the road. In order to avoid retirement crisis, there are three mistakes that you should avoid.

  • Not Starting Early

Retirement planning’s golden rule lies in starting early. The more the period between your current age and your retirement, the higher will be the yield. The fund value at the time of retirement will play a key role in determining your financial wellbeing.

For instance, Rahul, 65, who has invested Rs. 2,500 monthly for 35 years will have a better ROI than Rohan, 65, who started investing at 45. While the policies and the portfolio play a vital role in the returns, it is the amount of time invested that matters the most.

  • Not Saving Enough

The current generation, as opposed to general beliefs, does believe in savings. Savings are crucial from an investment standpoint. Savings is a golden rule for investments. Earnings – Savings = Expenses. If savings are a priority, you will have much more left in your tank than you first imagined. When you start early, you won’t have major liabilities, and thus the amount earned can be saved and invested wisely. Also, you can make use of a retirement calculator to consider inflation.

  • Fixed Savings

As you grow professionally, you start earning more in the form of bonuses, perks and increments, it is advisable to deviate this income towards your savings. Savings, if constant cannot overcome inflation. Thus, you must ensure that your contribution towards the retirement fund is regularly increasing. The best you can do is invest your progressive savings into retirement plans such as with Aegon Life’s retirement plan. This is an annuity plan that offers you a consistent income post retirement, so you can continue to lead the same lifestyle without any compromise.

With Aegon Life’s life insurance plans, you can choose from a variety of products which can help you overcome adversities post-retirement.

There are many investment avenues which can help you in a proper retirement planning. Pension plans, retirement plans offer a steady source of income which is quite beneficial post-retirement. Chalking out a retirement plan can help you prevent struggle in the later stages of your life. Equity mutual funds, balance funds, insurance and ULIPs are the ways through which you can build a substantial retirement portfolio. To know about Aegon Life Insurance products like term insurance and other products, visit our home page.


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