Retirement Planning has been gaining a lot of importance of late in India. Importance is more in financial magazines than among those who need it the most. As part of a financial plan, retirement planning in India could be significantly important in the coming 2-3 decades. Till a decade ago, retirement meant receiving pensions, purchasing a house to live in and going on vacations randomly. Retirement was a peaceful phase and no such planning was needed for it. Investments produced high returns with decent safety.

1. Retirement Planning for
Different Ages

2. Introduction
 Retirement has two important words associated with it :
 Freedom from Work
 Fear of living without Income.
 Planning ahead is essential for a smooth post Retirement life.
 Planning process varies for each person based on the age they
start planning.

3. For Ages 20-30
 People are at the start of their career and spend most of the money
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they earn
It’s important to resist temptation of owning a pair of that
expensive Jeans or a fancy Tablet. Try to save at least 20% of your
salary.
Learn to Invest by choosing simple investment products like a PPF
account which also gives you a tax benefit up to 1 lakh rupees..
Golden rule: Never choose products which mix Insurance with
Investment. Even though they are simple products to invest in they
do not work in the long run.
Things to Focus on: Clearing Student Loans, Saving Regularly.
Things to Avoid: Credit Card, Spending on Expensive Gadgets

4. For Ages 30-40
 It is quite challenging to prioritize goals in this decade as you will
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have many of short term goals like buying a house/securing your
child’s future but NEVER ignore planning for your retirement.
Create a Financial Plan and work on all your goals . Calculate
your Post Retirement needs. Create a mix of debt and equity
instruments with priority to equity.
SIP’s can be done in Large Cap, Mid/Small Cap Funds,
Balanced/Hybrid Funds with greater equity exposure. Mutual
Fund Pension Plans or NPS can also be a good bet.
Things to Focus on: Clearing High Interest Debts, Emergency
Fund in a Liquid Fund account, Medical Insurance for Self and
Family
Things to Avoid: Investing randomly, Avoid personal loans, loans
for vehicles, consumer durables etc,

5. For Ages 40-50
 In this decade you might be at the peak of your career and
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planning to retire in the near future.
If you have built a retirement corpus already you don’t have to
worry otherwise this will be the moment to be panic about your
retired life.
Your income might be very high at this point. Higher income also
means higher taxes.
EPF/NPS, ELSS, PPF should take care of the tax aspect and will
also help you save. Invest in Balanced Funds with greater Debt
exposure, Large Cap Funds, Liquid Fund, Tax Free Bonds.
Things to Focus on: Prepaying home loan in parts, Review of
existing investments.
Things to Avoid: Pension Plans with Insurance component, Too
much of Discretionary Spending.

6. For Ages 50-60
 This is perhaps the most important phase for this goal. By now,
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you should have a fair idea of the amount of Retirement Corpus
needed.
If you have already accumulated the required Corpus by
planning early you can live peacefully.
If you have not accumulated enough you might have to work
few more years to reach your retirement goal.
Shift from high risk to low risk investments. You can opt for SWP
(Systematic Withdrawal Plans) for this purpose in order to avoid
the risk of timing the markets.
SIP’s in Ultra Short term/Short term debt funds, 5/10 Year Bank
FD’s, Post Office MIS are good options.
Things to Focus on: Safety
Things to Avoid: High risk investments, Sectoral Funds

7. For 60’s
 By this age you will be devoid of responsibilities.
 Retirement benefits received can be invested in instruments such as
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SCSS (Senior Citizens Savings Scheme), Flexi Deposits of Banks, 5
Year Post Office RD, Post office/Mutual fund MIS, NSC.
You could also look into your hobbies as Income generating
opportunities.
Do not completely avoid equity. It is the one which gives a boost to
the portfolio. Allocation can be up to 20%. Reverse Mortgage is an
excellent option to generate regular income.
Things to Focus on: Liquidity, Regular stream of Income
Things to Avoid: Life Insurance associated Products, Ignoring the risk
of living long and thus spending the accumulated amount on
unwanted items.

8. Conclusion
 Life post retirement will be blissful if you plan ahead.
 Proper research has to be done before selecting an investment
product.
 Consult a Certified Financial Planner for comprehensive advise
on your finances, in case you do not have sufficient
time/knowledge.
 Retirement Planning should not be isolated from other goals.
 Start saving early and reap the benefits of the Power of
Compounding.