Retirement Fund: Have you also reached the age of retirement? Are you worried about how money will come in the future? Then you should check out today’s report to clear that worry. Time moves very fast. If you have not thought about post-retirement expenses now, then it will be too late. The reason for this is that to create a big fund, adequate time along with good investment is very important. No matter how much a person invests every month, if he does not have 15-20 years left for this investment, then he will not be able to create a big fund.
The most important thing in retirement planning is to decide how big a fund you need to create for your post-retirement expenses. While estimating this, you have to keep in mind that you will not need to make some expenses after retirement. But, some new expenses will increase. For example, after retirement, you will not have to worry about the school fees of your children. It is generally believed that by the time a person retires, his children’s education is completed. But, your expenses on medicines and medical facilities will increase.
A large fund is necessary for post-retirement expenses
A person does not know how many years he will live after retirement. Therefore, for retirement we must prepare a large fund which is sufficient for the expenses of the person as long as he is alive. If you prepare a large fund, then you will have many options available for its use. Therefore, it is most important to set a target to prepare a large fund for post-retirement expenses.
The benefit of starting investing early
A person can create a fund of Rs 3 lakh for retirement. Let us assume that you can invest Rs 15,000 every month in a mutual fund scheme through SIP. In such a situation, to create a fund of Rs 3 crore through a monthly SIP of Rs 15,000, you will have to invest for 26 years. During this time you will invest a total of Rs 46,80,000. If we assume an annual return of 12 percent, then your investment will grow to Rs 3,22,66,681 in 26 years.
Suppose there is another person who can invest more in mutual fund schemes through SIP but he has only 15 years left for retirement. Then, despite investing more, it will be difficult for him to create a fund of Rs 3 lakh crore. If a person invests Rs 25,000 every month in equity schemes of mutual funds through SIP, then with 12 percent annual return, his investment will be only Rs 1,26,14,400 in 15 years. This shows that the sooner you start investing in SIP, the greater are your chances of creating a big fund.
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