Life Cycle Retirement Planning


Every individual goes through a probable life cycle: literally from cradle to grave. So, should one’s financial plan. There are ages and stages of retirement planning as well. While everyone should move at their own pace, this article to serve as a guide for life cycle retirement planning. Read on to understand how you can change your financial planning at different stages in life, right from your 20s to your 60s.

Your 20s and 30s

For several people, their 20s and 30s serve as the age of financial freedom. People are usually exposed to the real world in this phase. They set to build their career and experience the power of earning potential. Though retirement might look a long shot from now, the earlier you start, the better. Work out a monthly budget and ensure that you are saving enough for your future. If it is difficult to make a lumpsum investment in the beginning of your career life, you can always rely on SIP investments. Make sure, that you are investing in different types of investment that caters to your short-term and long-term goals. 

Your 40s

40s is described as the phase of maximum earning potential and also expenditures. If things work in your favor, you are likely to be at the peak of your career or looking for new venture opportunities that you can term as your brainchild. Even if you feel you are not in the right direction for your career, fret not. It’s never too late. However, it’s quite essential to get serious about your investment options. This is era when one realizes the importance of investing to its core with their growing family. Ensure that your financial planning is on track and assess the gaps in your financial plan. Try to dedicate as much money you can for your retirement pot. And try living a debt-free life by getting rid of kinds of debt. 

Your 50s

Your 50s is when your retirement goals start getting the spotlight. One tends to pay lesser attention to the well-being of their loved ones, and more attention in building their retirement corpus. This is not the time to liquidate your retirement savings just because you feel you have invested enough. This is the right time to re-assess your long-term goals. If you are wondering where to invest money for your short-term goals, you might consider investing in safer investment options such as fixed-income securities. 

Your 60s

This is the age where one’s age gradually shifts and slowly transits towards retirement. However, if you are not ready to retire, you don’t have to. However, if you are content, this is time take up hobbies and activities that earlier missed your attention. It is rightly termed as the golden era of one’s life. However, make sure that you have money flowing for your post-retirement needs. With increased life expectancy, and increased health problems as one ages, it is important that you have a healthy source of income. However, as you age try to move your investments from equity mutual funds to fixed-income securities.

Remember, though it’s better to start for your retirement from the day you receive your first paycheck, you need not worry if you have missed the boat. Just start wherever you are. It’s never too late to get your financial life on track. Happy investing!