Planning for Retirement?

When in twenties, one hardly gives a serious thought to retirement. Once married and with a family, one starts approaching mid-thirties, one gets to clearly see piles of future expenses waiting right there. With grey hair replacing one's youthful cheerful attitude, and the little job security in today's turbulent times and piles of debt (obviously when we have car loan, home loan, children's education loan, marriage plans etc.) one becomes pessimistic about retirement. Even thought of quitting work permanently is scary. All the more, it is one thing to say that I would work beyond the age of 65, but practically really difficult to make it because of increasing health concerns.

My idea here is not to scare you but wake you up. It's never too late. Just look around our older generation and see what you would look to be when in the sixties. You would see both the best and worst of cases. Ideally, one should look into this important issue right from a younger age so that we can enjoy our old age peacefully with our loved ones without being a burden on each other.

Do You Know Your Expenses?

With the kind of life standards we all are maintaining (just make a rough calculation of the amount of money we are spending on our entertainment, food, car, travel etc.), it would be difficult to maintain the same at the time of retirement. You would seriously need a big retirement kitty and for that you need to plan well now. And one never knows when an injury or illness comes knocking and we are forced into an early retirement. A look at the current monthly expenses would give you a more realistic picture of your present and future financial situation. One of my friends has thought of discarding her big car saying that what's the use.. it's a depreciating item (eats up more fuel and high maintenance costs) and would better take a smaller car which is more economical and convenient to drive.

How Much Savings Do You Have?

My close friend's father-in law retired a few years back and he was not happy. Being a professional Chartered Accountant, he found it so tough to be home. Although he had sound investments and a regular annuity, due to some financial constraints, he decided to work again. Within the next few months, he decided to start his own CA firm with another friend of his. He, being a self-made man who achieved all on his own in his life, could not ask his daughters for support. Being educated and professionally equipped he could. But self reflect and check if you could do something to earn at that age. Best is plan well now.

Different financial advisers would give you different and really astronomical figures for the amount of savings you should have. But an idea of current expenses will let you know how much money you would need every month post retirement. Obviously, you will have to calculate the present value of money. Would you be able to manage them and have sufficient left for contingency requirements. Being Indians, our responsibilities never end. So, you will have to have not just a sufficient money to pay for basic expenses but also to pay for other contingent requirements.

Due to your more immediate financial commitments, do not give your saving for retirement a backseat. Be the Super Young Retirement saver.