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RETIREMENT PLANNING

Retirement refers to the time of life when one chooses to permanently leave the working-life behind. Retirement planning refers to financial strategies of saving, investing and ultimately distributing money; meant to sustain oneself during retirement. Many popular investment vehicles such as Individual Retirement accounts to allow retirement savers to grow their money with certain tax advantages. A proper planning for retirement means to prepare today for one’s future life so that one can continue to meet all the goals and dreams independently. This includes setting retirement goals, estimating the amount of money that a person requires as well as investment for growing one’s retirement savings. Every retirement plannings are unique to their significant nature. Having a proper retirement plan gives a retired person the opportunities to receive income from different sources. Doing this allows a retired person to plan for various financial goals and ensure that funds are available when the retired person needs those. Retirement planning is crucial for financial stability and independence in old age. It entails the decisions on retirement objectives and calculating how much money is required to reach the goals. The general rule of thumb is to save atleast 15% of one’s pre-tax income for retirement. After retirement, a person retires from work, not life. Thus, a retired person should set new dreams for post-retirement life. At the same time, the retired person may also want to maintain day-to-day lifestyle properly without worrying about expenses. By planning in advance, one can define the path to achieve the life-goals without any financial dependence. However, it is essential to consider individual factors such as - age, income and desired retirement life styles.