Planning for retirement is not something you should leave for later. Most people think they can start saving for retirement once they’re older or earning more. But waiting too long can make things stressful. If you want to live a relaxed and peaceful life after you stop working, you must begin preparing as early as possible.
Let’s understand why early retirement planning matters and how you can build strong habits for a better future.
Build the Retirement Habit in Your 20s or 30s, Not in Your 50s
Retirement planning is not a one-time action. You cannot just wake up one day at 55 and suddenly arrange everything for the next 30 years. Financial experts believe that saving for retirement should become a regular habit.
Ravikant Rathore, CIO of Tata Pension Fund Management, advises young professionals to treat retirement planning like a regular monthly routine, just like paying their rent or phone bill. When you invest small amounts every month from the beginning of your career, the effect of compounding helps your money grow on its own over time.
Even ₹500 or ₹1,000 invested monthly in the right plan can create a large fund in 25–30 years. The earlier you start, the more time your money gets to grow.
Start Small, But Stay Consistent with Your Investments
You don’t need to start with a big amount. Start with what’s comfortable. The key is to remain consistent and not stop in between. If you keep investing regularly, even with small amounts, it will slowly become a part of your lifestyle.
Let’s say you start investing ₹1,000 every month at age 25, and increase it by just 10% every year. By the time you retire at 60, you could easily build a fund of ₹50–60 lakhs or more, depending on the return rate. This kind of planning gives you financial peace of mind when you retire.
Fixed Deposits Alone Are Not Enough for Retirement Goals
Many people rely only on their savings account or fixed deposits to plan for retirement. But these options offer very limited returns. With rising inflation, your savings may lose value over time.
That’s why you should diversify your investments. A proper mix of equity (stocks), debt (bonds), and government-backed schemes is necessary. You can also consider the National Pension System (NPS), which allows you to choose the ratio of equity and debt according to your risk level.
NPS gives tax benefits under Section 80CCD(1B) and helps you build a retirement corpus slowly with disciplined investing.
Increase Retirement Investments as Your Salary Grows
A common mistake people make is to continue investing the same amount for years. But if your income increases, your investment should also grow. Even a small step like raising your SIP (Systematic Investment Plan) by 5–10% every year can make a big difference to your retirement fund.
Let’s say you started with ₹2,000 monthly and increased it by ₹500 each year. Over 30 years, this habit can help you create a fund that’s more than double compared to a flat ₹2,000 per month.
So whenever you get a salary hike, consider increasing your retirement savings first before upgrading your lifestyle.
Retirement Is Not Just About Stopping Work — It’s About Living Free from Worry
Most people think retirement simply means stopping your job. But the bigger picture is freedom from money stress, from depending on others, and from working out of compulsion.
A well-planned retirement helps you take care of your regular expenses, health needs, and even gives you money to travel or enjoy life. Without proper planning, you may have to depend on your children or work in old age just to cover daily costs.
Financial planning expert Ravikant Rathore says that retirement should be treated with the same seriousness as your career. If you work hard to build a strong job profile, you should also put equal effort into building your financial future.
Add Retirement Planning to Your Monthly Budget
Most people plan for house rent, groceries, phone bills, and EMIs — but forget to include retirement in their monthly budget. Just like how we budget for daily needs, add retirement investment as a fixed item in your list.
Doing this ensures you don’t delay your contribution. If you keep waiting for a “better time” to save, you will always find some excuse to avoid it.
Tools That Help You Plan Better for Retirement
Here are some options you can use to build your retirement fund:
- NPS (National Pension System): Flexible investment mix, tax benefits, and monthly pension after retirement.
- EPF (Employees’ Provident Fund): Employer and employee both contribute. Works best if you are salaried.
- PPF (Public Provident Fund): Long-term investment with tax benefits and fixed interest.
- Mutual Funds: Equity mutual funds (for long-term growth), debt mutual funds (for safety), and hybrid funds.
- SIPs: Monthly investments in mutual funds. Offers good returns if held for long.
Pick one or more of these tools based on your risk appetite and financial goals. The earlier you begin, the better your results will be.
Think Long Term, Not Just Short Term
Many young earners focus only on short-term needs — car EMI, weekend trips, gadgets. While those are fine, you must not ignore the long-term goal of retiring with dignity.
Start with a simple step — open an NPS or PPF account, or start a mutual fund SIP. Review your investments once a year, and make changes based on income and age.
Retirement might seem far now, but it arrives faster than you think. Preparing early is not just smart — it’s essential.
Disclaimer: This article is for information purposes only. Please consult a certified financial advisor before making investment decisions.
Source: Financial Express
