Have you already planned for life after you retire? In case you have, great! But, if you’re still looking for ways to make those golden years of your life count, you had better hurry up.
Why? Because the earlier you start planning and saving, the better your chances are of building a decent retirement fund. After all, your bank balance needs to match the standard of your retirement dreams, doesn’t it?
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To make your retirement dreams come true, you just need a little bit of planning and some sound money management. You also need to be careful about all those myths that can potentially destroy your dreams of leading a stress-free retired life.
These are common misconceptions that need to be debunked in order to get your retired life up and running. Listening to what the conventional wisdom says is good. But, following it blindly is not.
Although you need to be a bit careful, there’s no need to panic. All you need to do is ensure that there’s no room for silly mistakes or tiny loopholes in your retirement plan that could lead to repercussions later. Once that’s done, more than half of your work is taken care of.
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So, before you get started, let’s debunk some common retirement planning myths for you.
- Myth #1: Retirement planning? I can start whenever I want to.
Like with everything else, planning for your retirement has to start at the right time as well. Want to know when that is? Well, it’s RIGHT NOW!
Yes, you read that right. There’s no point putting it off for tomorrow. Even if you’re still in your 20s, and you’ve just landed your first job, you need to start planning for your retirement. You need to think way ahead of time (sometimes that could even mean planning decades ahead).
The logic is simple. The earlier you start, the better you can plan. You get a lot of time and resources to ensure that you make all those dreamy retirement plans turn into a reality. No matter how hard or inconvenient it is for you, you have to start NOW!
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- Myth #2: There’s nothing tiring about retiring
Although retiring may sound like a walk in the park, it’s not that easy. There’s a lot more to it than merely deciding what you want to do, or where you want to live post-retirement.
There are some crucial factors that you need to consider, like your savings, investments and pension plans. Since all of us are not government employees, we need to take care of our own pension plans.
Choosing some good investment options, investing in Life Insurance policies and investing in the stock market are some things you could consider.
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- Myth #3: Your inheritance is enough for your retirement
Regardless of how much you inherit, you still need to save for your retirement (well, unless your parents are millionaires). If you think your inheritance money will last you a lifetime, think again!
Taking the rate of inflation into consideration, the cost of living will only increase. There are high chances that you will outlive your inheritance money and repent later. In order to avoid this particular trap, it is imperative that you start planning for your retirement as soon as possible.
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- Myth #4: Health expenses aren’t important
One of the most important things you need to plan for your retirement days is your health expenses. As you grow old, your health is only going to need more attention. It makes more sense to think of all those heavy medical bills now instead of worrying about them later.
So, purchasing a good Health Insurance policy should be right at the top of your priorities. After all, prevention is better than cure.
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- Myth #5: Post-retirement, your expenses decrease considerably
This is one of the most common myths people tend to believe in. Although it might look like the most inexpensive phase of your life, the truth is completely different.
Even if you have your own house and car by now, you need to think of other important things as well. Your health, like we mentioned before, will need some maintenance (and money). And, let’s not forget, this is the phase of your life where you get to do all those things you always wanted to do.
But, even if you decide to just spend your retired life resting easy in your armchair, your day to day expenses certainly won’t decrease, especially with the spectre of inflation always looming.
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- Myth #6: Your spouse’s retirement plan will accommodate you as well
If you think that your spouse’s retirement plan is enough to cover you as well, you’re absolutely wrong. The cost of living is only going to increase as you grow older. Would you like to risk your financial security just because you’re too lazy to plan now? Certainly not.
Remember, the two of you are two different individuals and hence your needs are going to vary. One person’s retirement plan (no matter how elaborate it is) may not be enough to cover the other one as well.
In any case, it’s always better to have some extra financial support. If one of you needs extra funds, the other one’s retirement corpus could come in handy. Plan smart and plan ahead.
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- Myth #7: I must always invest safe.
If you’re planning for your retirement, you must be willing to take some risks, especially when you’re young. You can’t simply sit and rely on those Fixed Deposits.
That doesn’t mean that investing in Fixed Deposits is a bad option. It just means that you need to consider other investment options as well. Like the ones that might be slightly risky, but provide some great returns as well. SIPs are a great option to consider, so why not give it a shot?
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We agree that retirement planning isn’t one of the easiest things to do. But, hey! Think about living a comfortable life post retirement. It’s certainly well worth the trouble.
So, in case you believe in any of these myths, it’s time to change your mind about them. Now that we’ve made things easier for you, all you have to do is put your plan into action.
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This is really a good article. Usally people have these kind of misunderstandinfgs when it comes to retirement planning.
Appreciate your thoughts. Have a nice day!