Retirement Planning

Retirement Planning

“Retired person without money is called an old man, and with money, a gentleman”

Everyone needs to plan for retirement. Every person is unique and so are their needs and aspirations. However, one thing is more or less constant – how to adequately plan for your retirement. The following guidelines will help you plan better for yours and your family’s future.

Earlier the better:

Starting with a proper retirement plan at an early age offers numerous advantages. The earlier your start the smaller the sums of money are needed to be saved towards your retirement pot. The cost of delaying savings in significant because you lose out on compounding interest. Read our blog to learn more about the enormous cost you are paying by delaying savings for even one year.

Plan for the costs:

The cost of retirement can be determined by calculating the likely expenses at retirement in today’s value and the adjusting it with expected inflation rate. Medical emergencies, routine health care costs, vacation to meet friends, relatives and grandchildren are typically the big expenses one needs to account for assuming that housing and transportation are already secured. Expats who work upto 65 years have to calculate and provide for the next 15 to 20 years, post-retirement.

Diversify Investments:

Don’t put all your eggs in one basket, however attractive the scheme may be. Use different strategies and avenues of investment to minimize risk. Investments can be classified as High Risk, Medium and Low Risk. High risk investments have the potential to give high returns, while low risk investments are much safer, but the returns are small. A judicious allocation between all the three categories helps safeguard the investment and get better returns at the same time.

Inflation and Tax Liabilities:

The tax rules vary from country to country. Inflationary trends too. Take these factors into account while going for a retirement plan. The cost of living, inflationary trends and tax structure in your home country have to be factored in.

Service Gratuity – Is it enough?

Too much reliance on service gratuity is fraught with risk such as will the company be around when you retire or will you be let go long before retirement? Even in the best-case scenario, the service gratuity paid by companies and governments for their employees is nominal and only a supplement to one’s own retirement savings.

Long Term vs Short Term:

For retirement planning, long term commitment to savings is important. Short term behavior such as withdrawing funds to book immediate returns can be tempting. However, keeping money invested in long term is wise, even if your retirement pot takes a temporary hit due to market fluctuations.

Our advisors can help you plan for your financial requirements after retirement; e-mail us at for more info.