While people have varying financial goals, one thing that everyone works towards is ensuring financial independence after retirement. When we are young, our risk tolerance levels are high since we can absorb any shocks from an erroneous investment decision or abrupt market behaviour. This is because we are still earning and can make changes to our investment planning to achieve our goals.

However, post-retirement, the risk tolerance levels drop since we depend on our savings to see us through the rest of our lives. Hence, despite the fact that there are numerous investment options, it is important to look for ways in which you can get regular income without exposing your corpus to too many risks.

 Importance of Investment Planning After Retirement

Many people have a target in mind as the retirement corpus for their post-retirement life. We invest in various instruments to accumulate the target amount, like stocks, mutual funds, bonds, real estate, gold, etc. However, once we retire, we need to ensure that the corpus outlives us. Hence, it is important to ensure that while you are utilising the money, it is also invested in instruments that can offer capital safety and ease of withdrawal with a reasonable rate of return.

Income Ideas for Senior Citizens

If you still want to work, then there are numerous opportunities for employment for senior citizens. Depending on your area of expertise, you can get into consultancy, training, or leverage social media platforms and create a source of income based on your knowledge and experience. Here are some income ideas for seniors:

• Rent a room in your house
• Blog on your area of interest
• Start an online training program
• Invest smartly

Post-Retirement Investment Options

Here are some post-retirement investment options that can help you secure a regular flow of income:

• Invest in a regular-income life insurance plan
  A pension plan or a retirement plan offers insurance cover and returns on investment. When you opt for a pension plan, you are required to pay a fixed premium for a specific duration. After you retire, the insurer pays a fixed pension every month, quarter, or year depending on the plan. Some pension plans also offer a lump sum payment on maturity. Insurance companies also offer monthly income plans that can help you get guaranteed¹ income during the golden years of your life.
  
  
• Provident Fund
  The Employee Provident Fund (EPF) is another excellent option for generating regular income after retirement. You can invest a fixed amount every month from your salary in your EPF account. The interest earned by you compounds every year and helps create the corpus you need. Of course, the employer contributes to the EPF account too. You can also open a Public Provident Fund (PPF) account to create a larger corpus.
  
  
• National Pension Scheme
  This is a voluntary scheme backed by the Indian Government that allows individuals to make contributions toward their retirement corpus. Once you reach 60 years, 60% of the corpus is deposited into your bank account, and the balance, 40%, is used for buying annuity products that can help generate a regular source of income.
  
  
• Fixed Deposits
  Once you receive your retirement corpus, you can also opt for a fixed deposit with a monthly interest payout. However, it is important to remember that, usually, FD rates are lower than inflation rates. Hence, choose this option carefully.
  
  
• Create an investment portfolio
  Once you have a corpus, you need to invest it carefully to protect your capital and generate regular income. You can start by talking to an investment advisor and creating an investment portfolio that invests in instruments keeping your financial goals in mind. This might include some stocks/mutual funds. Make sure that you don’t take unnecessary risks and focus on income generation with capital preservation.

There are many options available to earn regular income after retirement in India. If you are keen on working, then you can look at online and offline options based on your health and preference. You can also invest your retirement corpus wisely without taking too many risks to generate a steady source of regular income.

Conclusion

Once you retire, while your salary stops, you still have to manage regular expenses. Also, over time, inflation will cause goods and services to become costlier. Hence, to live a financially independent and stable life, it is important to start planning for life after retirement. Make sure that you start creating a corpus from a young age to benefit from the power of compounding. The tips mentioned here can help you earn money even after retiring. 

L&C/Advt/2022/Aug/1838