15 DEC 2016
Top 8 retirement tips for youngsters
Here, we present you with 8 retirement tips that will help you to plan your retirement.
- Save nicely
If you are a 20-something in your first job or nearing 30 and in your second or third job, the principle remains the same. The sooner you start saving, the more beneficial it will be for you. You can harness the power of compounding for a longer period of time. Start saving, even if you can only do so in small amount. Remember, every drop put together makes the ocean.
- Invest wisely
Saving is the first step. More important than saving is to invest the money wisely in instruments like life insurance endowment plans or PPF's so that they may fetch you a substantial amount when it is time you retired. Don't depend on internet hacks or hearsay. Do a thorough research before you invest in any instrument.
- Cut excessive spending
Make a budget for yourself and stick to it. Try not falling for temptations of buying the latest gadget or the latest smartphone. Cut your coat according to your cloth. It's just not a good idea to be riddled with loans and EMI's.
- Buy a term plan
If you have dependants, buy a term plan. If you don't have dependants, still buy a term plan. A term plan is the simplest life insurance plan, in which, your family gets a fixed payout in the event of your untimely demise. The younger you are, the better deal you get. You may want to start a family soon. Buying a term plan at a later stage may not be such a good idea as it may become costlier for you at a later stage. Do some research over the internet and find a good term plan for yourself.
- Buy a critical illness plan
Buy a critical illness plan. Life is unpredictable and you never know when you might fall critically ill. In such a scenario, it is better to have yourself covered with a critical illness plan that helps and aids your recovery quickly. Basically, a critical illness plan gives you a fixed lumpsum in the event of you being diagnosed with a pre-listed critical illness. This will help you to tide over the critical illness in the sense that it will provide you with an income replacement in case you are unable to work for any length of time due to the illness.
- Buy mediclaim
Even if you have a critical illness plan, go for a mediclaim. It will help you with hospitalization expenses like a fracture etc requiring a procedure. These things are not covered by a critical illness plan. These plans will see to it that your savings for your retirement are intact and you do not have to dip into them in case of any emergency.
- Plan your retirement
Plan your retirement in terms of when you want to retire and how do you want to spend your retirement. You may want to retire early and only work when you feel like working. Also, you may want to spend a lot of time pursuing your hobbies and spending time indulging in leisurely activities.
Last but not the least, dream. Dream big about your retirement. Imagine yourself scaling the Swiss Alps. Think about watching a football match in Wembley stadium. Think about how a trip aboard a cruise liner looks like. If you don't dream big, you will not be able to motivate yourself to reach that goal and keep saving and investing for it.
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