What is Retirement Planning?
When you retire, you are still under the obligation to fulfil certain long-term and short-term goals for yourself and your family. Retirement planning is when you identify the means for fulfilling these goals by analysing your financial objectives, your income sources, your future expenses and the need for emergency funds.
Retirement planning should start at a reasonably early age when your finances are stable. That way, you can invest in the retirement plan over the years without having to worry about disrupting your essential expenditures. At the end of the plan’s term, you receive the benefit of a steady and regular income as a means of financial support.
For example, if Mr Nitin chooses a retirement plan at the age of 40 years and invests in it for the next 20 years, he can plan his retirement at the age of 60 years and receive a regular income during his retirement as per his needs, for as long as he needs it.
Retirement planning can be as flexible as you want it to be since your needs will be unique, and you can decide how much you want to invest and for how many years you need the benefits to be paid out.