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Be honest- does retirement also cross your mind too? Between the deadline chasing, planning the weekend gateway, and perhaps managing the rent or EMI, thinking what life on 60 would look like, thinking… unnecessary. But here is the deal. The future you are currently counting you to be smart with money.
According to the India Retirement Index Study (IRIS) of Max Life Insurance, 44% of Indians believe that the correct age to launch a plan for retirement is 35. The truth is that, already you start, the less stress about money you later. So, let’s talk about what we don’t usually do, savings for retirement!
Why think about retirement in your 20s?
Really, our generation is not relying on pension. And with the cost of growing, inflation and uncertain jobs, your golden years will be golden only if you plan further. Starting early gives your money more time to grow, thanks to the power of compounding (basically, earning money over time).
The more you start, the more time your money will be to grow. Compound interest means that you earn interest on both your initial investment and interest deposited over time.
Simple mathematics: If you invest in a retirement fund in a retirement fund at 5,000 per month at the age of 25, then considering 12% returns, you can be around ₹ 5.5 crore till starting from 60. Start 35? This number becomes ₹ 1.75 crore. Now this is a big difference, right?
How to start retirement funds?
Starting does not mean that you have to dump lakhs in an account overnight. It is about small, consistent steps that create long -term money. If your employer provides EPF, this is a great start. If not, you can get the benefit of tax-free returns by opening a PPF account. You can also consider NPS (National Pension System), a government -backed scheme that comes with tax benefits. For those who see the options associated with the market, mutual funds through SIP, especially equity mutual funds, provide high long -term returns. If you are open to some risk, investing in blue-chip stock can also help in making money over time.
Even ₹ 1,000 per month is a great start. As your income increases, you can increase your contribution. The key is stability. Staying for a long time will help to multiply your money through compounding power. But when you invest, it is important to remember that your retirement fund is not for short -term expenses. This breathtaking holiday or a new gadget may seem to be a good reason for taking a dip in your savings, but you keep telling yourself that this money is for the future. Allow it to grow inadvertently so that when the time comes, you have the freedom to enjoy life without stress.
As your career progresses, your financial situation will change. Maybe you will earn more, or your expenses will shift. Therefore, it is important to review your retirement plan every few years and adjust to stay on the track.
The best time to start a retirement fund? Tomorrow. Second best time? Today. The longer you wait, the more difficult it is to build a solid nest egg. Therefore, even if retirement feels like a lifetime, taking small steps will ensure that you do not have to worry about money when you should enjoy life.
