Retirement Planning Guide: Secure Your Future
Planning for retirement is no longer optional—it’s a necessity. With rising life expectancy, changing family structures, and increasing inflation, securing your financial independence has become more important than ever. In this guide, you’ll learn why retirement planning matters, how to calculate your ideal retirement corpus, explore industry trends, and account for critical factors like inflation and healthcare costs to ensure a comfortable and fulfilling retired life.
Why Should an Individual Have a Retirement Plan?
With people living longer, the rise of nuclear families, and increasing inflation and healthcare costs, planning for retirement is more essential than ever. Once you retire, your regular salary stops, and your financial security depends on the savings and investments you’ve built over your working years.
- Financial independence even after you stop working
- Freedom to live life on your own terms
- Preparedness for medical and lifestyle expenses
- Peace of mind for you and your loved ones
The retirement journey generally involves two phases:
- Accumulation: Building your savings (your retirement corpus)
- Distribution: Using your corpus to generate sufficient income post-retirement
How to Ensure a Comfortable Lifestyle Post-Retirement
- Estimate your retirement age and desired lifestyle – Decide your retirement age and preferred lifestyle.
- Calculate future expenses – Factor in inflation. If expenses are ₹50,000/month today, with 6% inflation, in 10 years you’ll need around ₹1 lakh/month.
- Determine your retirement corpus – For instance, needing ₹12 lakh/year at 6% returns means a corpus of ₹2 crore.
- Start early and invest wisely – Time allows investments to grow.
- Diversify – Use mutual funds, annuities, FDs, pension plans as per your risk profile.
Why It’s Essential to Plan for a Secure Retirement Life
- Higher life expectancy – Funding 20-30+ years of retired life.
- Rising expenses – Inflation impacts food, transport, and housing costs.
- Nuclear family shift – Less reliance on children for financial support.
- Healthcare costs – High and increasing medical expenses in later years.
Without a plan, you risk outliving your savings, potentially affecting your dignity and comfort.
Upcoming Trends & Innovations in Retirement Products
- Annuities with guaranteed monthly income, regardless of market conditions.
- Flexible annuity options with regular contributions and systematic payouts.
- Emergency payout features for health or critical situations.
- Custom retirement plans tailored to lifestyle, health, and aspirations.
The retirement product space is evolving to cater to diverse needs.
What Inflation Rate Should You Use for Planning?
- General inflation: Typically 5–7% per year in India.
- Personalized calculation: Factor in location, housing, lifestyle, and family circumstances.
What About Medical (Healthcare) Inflation?
- Healthcare inflation in India is ~14% currently.
- Allocate 12–15% of retirement spending for healthcare.
- Create a dedicated health fund as part of retirement planning.
- Have adequate health insurance to protect your corpus.
Retirement Corpus Calculator:
Expected Inflation Rate (% per year)
Also read: Why Retirement Planning is Different and More Challenging in India
Also read: 6 Stages of retirement planning
