To lead a comfortable retired life with your savings is a goal that most people share. Saving enough money is important to do so. Unfortunately, many individuals start the process very late.
So when should you start saving for retirement?
The best time to start is now! It’s never too early or too late to begin. Never mind if the amount that you can invest seems insignificant.
Determine your goals –
While it is difficult to estimate how much money you will need 20, 30, or 40 years into the future, you do need to make a rough estimate so that you have a clear goal.
When you retire, your spending pattern would undergo a change. For instance, you may spend less on commuting but more on medical expenses.
You may use the 50-30-20 rule –
It means 50% of your monthly income goes towards meeting your essential expenses, 30% for discretionary spending and that you save the remaining 20%.
So should you save at the beginning of the month or at the end?
Your plan to build a retirement fund has a greater chance of succeeding if you put money into savings at the beginning of the month.
If you wait until the end of the month, there is the likelihood that you may not be able to meet your monthly savings goal.
Don’t forget to carry out periodic reviews –
It is vital that you review your progress at least every six months.
Ask yourself these questions:
How have your investments performed?
Are you achieving your targeted goal?
This will help you to adjust your investment plan according to your goal of saving an adequate sum for your retirement.
We at Aditya Birla Sun Life Mutual Fund aim to help you strategize your retirement plans. One of the ways to achieve your retirement goal is by starting an SIP. To know how to achieve your goal, please visit SIPNOW.birlasunlife.com
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.