6 Benefits of Retirement Planning

Given how life pans out in the future, it is clear that not only planning for retirement but also starting early makes it count. Thus, 'Now' is the time when you should start your retirement planning."While a bank loan can fund an expensive college course or a grand wedding; it cannot be availed to finance a life during retirement." Here’s how we could benefit from retirement planning.

Why 'NOW' is the Time - Benefits of Retirement Planning

1. Benefit from the returns on reinvestment – ‘compounding effect - Ideally, retirement planning should begin as soon as a person starts earning. In this way, you can set aside affordable amounts for a longer period and gain from the compounding benefit. That’s the compounding benefit that validates the premise as to why people should plan for retirement early enough.

2. Plan for unforeseen expenses – In time there could be many reasons and situations that may require you to spend a large amount of money. It could be additional medical bills, treatment costs due to illnesses, and other unexpected financial needs of your family. By planning for retirement, the corpus you build also serves as a safety net in times of unpredictable situations.

3. Safeguard property and assets – Without a plan for retirement, people may be compelled to liquidate their assets to support their lifestyle during retirement or sometimes families have to rely on income from the sale of the property to deal with emergencies. By building a retirement fund, you can safeguard your property and assets and pass your legacy forward to your children and grandchildren.

4. Deal with transitions smoothly – There are many changes in life that may need immediate execution within constricted timeframes. It could be a career change, a change in job location, or relocating cities. If you already have a plan for retirement, it would be easier for you to accommodate other changes that may happen in life.

5. During the working years, you might have to relocate for a new job or take a sabbatical for higher education, to raise your baby, or nurse an ailing parent. In either case, retirement planning ensures that the transition is seamless and doesn’t haunt your golden years.

6. Choose a retirement plan that works for you – Here, people like Sonam, may ask, “What do we get by investing in retirement plans? Why not live one day at a time?"

And a friend like Saurav would wisely reply, “Who will secure your financial future once you stop working? How else can you ensure a steady stream of income? Here's why investing in retirement plans work because.."

1. Firstly, it secures your future financially and protects your family in the cases of your absence.

2. Secondly, it provides various benefits including tax benefits as per prevailing tax laws.

3. Thirdly, it provides a substantial amount at the time of maturity.

4. Fourthly, you can choose from different retirement plans and customize your portfolio based on your investment appetite. Based on your requirement, there are different types of retirement plans offered by Monarch BA.

While you can take a cue from the knowledge and experience of others, your plans for the future need to be in line with what and how you perceive and expect them to be. Quoting a friend who succinctly put it, "Financial planning is more than a process, it is a mindset!"

The earlier you plan your retirement, the more you would be able to save and enjoy your post-retirement days. Plan for your retirement now!