“How you invest during retirement is as critical as how you invest in preparing for retirement. Things are never as simple and automatic as they once may have been — you worked hard, saved, and then sat back and collected your benefits. You can’t rely on someone else coming up with the cash you’ll need once you stop working.” Daniel R. Solin, the Smartest Retirement Book You’ll Ever Read
So, when should you start saving? This is something that is difficult to decide unless of course you are a financial expert and are on top of the game. Is it too early? Or is it too late? Don’t let these conflicting notions inhibit you. Take a cue from your seniors who have been on this journey before as they have the experience to offer you solid advice. Still wondering how to go about things, take a few pointers from this article and chalk out your own financial plan for senior citizens.
Financial Plan for Senior Citizens – When to Start?
Start early! That’s the single most important advice that is doled out by most senior citizens. That’s not all, there are so many other things you need to follow or unfollow when you are saving for your retirement, some of it is as follows,
Learning the Fine Art of Delayed Gratification
Save first, the rest will follow. We know that sounds difficult to follow, especially when your income is nothing to write home about. However, this is the best way to build your retirement nest egg.
If you are wondering exactly how much to save. Try to put aside at least 15 to 20 percent of your income every month. If this does not seem too feasible for you, take time out to review your monthly expenses chart. Keeping a tight rein on your expenses may help you control unnecessary expenses. Even small changes can bring about big results.
All Work Some Play
It is important that you bring about some Life-work balance as it increases your happiness level when you have some extra money to spend, you feel a lot happier.
While splurging all the time is ruled out, ensure that you allow yourself some discrepancies here and there, as long as it does not affect your savings goals. It is necessary you keep a budget for yourself and abide by that.
Consider your electricity bills, see if you can control that or telephone bills, a few adjustments here and there can work wonders and help you save up for those sudden requirements.
Do Not Fall for Lucrative Trends
It’s the business of marketing professionals to pique consumer interest, but you have to look before you leap. Don’t fall a prey to marketing gimmicks and commit a harakiri. If you want to join the latest investment bandwagon try to go for something which had enjoyed a certain track record. New may not always prove to be the best thing around. Even if you fall for the cool new investment trend, do your own research, after all, it is your life’s savings and you are risking everything you have ever earned.
Reach Success with Tax-Deferred Benefits
This is one strategy that always works, as an experienced senior would tell you. If you want to reach your savings goals you will have to go for tax-deferred benefits. There are a number of tax-deferred retirement strategies you can try and implement that includes the PPF or the public provident fund. If you want to invest you can go up to 1.5L every year and also claim tax benefit under the section 80C. You’ll earn interest close to 8.5 %( 8.0% in 2016) and also tax-exempt. Also, you can withdraw the money prematurely under specific circumstances only, such as education, marriage, house and so on.
You can go for all the above-mentioned strategies and work your way to building a sizable retirement kitty. Best of luck!