Retirement is a significant stage of life that brings about a shift in lifestyle and financial circumstances. Even for senior citizens with no liabilities or debts, planning retirement is vital and requires due attention.
The primary reasons are achieving financial security, optimising savings, addressing healthcare needs, and ensuring a well-structured post-retirement life.
Mayank Bhatnagar, Chief Operating Officer of FinEdge, said, “We strongly believe that retirement planning is essential, regardless of whether a senior citizen has liabilities. Remember, average life expectancy is rising with every passing decade. While this is a good thing, it can significantly stress your retirement savings, especially when you consider the inflated cost of living 20, 25 or even 30 years into your retirement.”
Most people save a substantial amount of money during their working years. Without a well thought out plan, these savings may remain idle or may not be invested wisely. Retirement planning helps make strategic investment decisions to ensure steady and optimum returns.
Thus, everyone must plan for an extended retirement and accumulate funds aggressively at least 20-25 years before their target retirement date. Once you retire, you should work with an expert to manage and deploy your accumulated funds to negate the risk of outliving your savings.
Financial independence is of utmost importance in the golden years. Why? Even without liabilities, the regular stream of income ceases post-retirement. Therefore, one must build a sizable corpus to maintain the same lifestyle and meet regular expenses. This can only happen with thorough retirement planning. It ensures senior citizens can lead a financially independent life without curtailing their wishes due to monetary constraints.
Also read: For Rs 1 lakh monthly income post-retirement, build up this much corpus before you turn 60
Also read: Gold and silver prices likely to fall further
“Even if you do not have liabilities, you must be prepared for potential high-value outflows due to medical emergencies, which become all the more common during one’s senior years. Besides that, one should ideally build a corpus specifically earmarked for leisure activities like vacations or other life experiences. A well-considered approach to retirement planning will ensure you have enough to meet all these needs,” added Bhatnagar.
As mentioned, healthcare is another critical aspect that necessitates retirement planning. With advancing age, healthcare needs and medical expenses rise. A robust retirement plan can provide a financial cushion for unexpected medical emergencies and regular healthcare requirements. It reduces the financial burden, ensuring seniors can afford the best healthcare facilities without financial stress.
Dhirendra Mahyavanshi, Co-Founder and CEO of Turtlemint, said, “Healthcare expenditures increase dramatically as people age, and inflation gradually reduces purchasing power. Additionally, the average life expectancy is higher than before. In this situation, insurance becomes an essential cornerstone of financial planning. Adequate insurance coverage is particularly vital for a nation like India, underpinning economic stability at the individual level. Without adequate coverage, unforeseen circumstances can swiftly erode hard-earned savings.”
Therefore, one must have the right insurance coverage and structured savings plans to lay the foundation for a secure financial future. Typically, these tailored plans provide a structured approach to wealth accumulation, ensuring a comfortable retirement while safeguarding against unexpected expenses. By diligently contributing to savings, seniors can build a financial fortress that secures their later years but leaves a legacy of financial wisdom for generations.
Senior citizens should understand that retirement planning is not about managing liabilities but about creating opportunities for a financially secure, healthier, and fulfilling life during their golden years. Hence, regardless of whether they have debts, senior citizens must prioritize thoughtful retirement planning.