Tuesday, October 9, 2007

Your Retirement

You have completed the fixed years in your service and its time to retire or you have a business or a profession other than a job and you have decided its time to bid good bye. T he process starts a little bit earlier than you think. The preparation begins before. Preparation is done by two entities you and the government department responsible for handling retirements.

You prepare mentally to agree that you are old enough to rest and play with your grandchildren. Sometimes government does it for you. Prepare for the retirement before. It may be mentally, physically, emotionally, and socially. Plan for retirement and plan for afterwards. Your retirement planning includes how much money you want to have when you retire, what to do to get that much of money, where to invest when you get the money etc. In United States there is Social Security system to take care of the workers after their retirement. In India, there is no such organization or trust to look after you. You get your pensions from the respective departments. In some jobs you do not get pensions. After your retirement you get a good sum of money. Then what you do. Deposit it in the bank and occasionally take the needed money out.

Or fix a part of the money to get a double on that. You decide how much money you will need to live a good life after retirement. The total money needed can be calculated with the help of different retirement calculators available with the different companies. The amount will depend on many internal and external factors. Internal factors may include what is your earning and investment capability right now, how many years are there to your retirement etc. External factors are like inflation, rising living costs, any other adjustment etc. Pension plans are offered from various companies. Invest in such schemes after choosing carefully. You can invest in different schemes that are available with different companies. You can invest in shares and stocks, mutual fund, bonds or any other such investment options.

While investing you should see the return and the risk associated. For the money you get after retirement be very cautious. Investing in stocks is a quiet risky business. If you are totally familiar with the stock market then invest directly in stocks. But if are not familiar, but want to grow the money quickly then go for mutual funds. Bonds are less riskier. You income Interest Interest from the money you deposit in bank, bondsDividend from mutual funds investments, from investment in stocks. Retirement means you leave your job or your business to other after doing it for a fixed time. Retirement is the point where you stop employment. You generally retire upon reaching a determined age, when physical conditions don't allow you to work any more, or even for personal choice like having adequate pension or personal savings.

Retirement age

In most countries, the idea of a fixed retirement age is of recent origin, being introduced during the 19th and 20th centuries. Prior to that workers continued to work until death, or relied on personal savings or the support of family or friends. Nowadays there are systems to provide pensions on retirement, which may be sponsored by employers or the state. The retirement age varies from country to country but it is generally between 55 and 70. In some countries this age is different for male and females. The most dangerous or fatiguing jobs generally have an earlier retirement age In the India, while most view 60 as normal retirement age. But you may retire before then, because of certain causes such as job-loss, disability or wealth.


When you retire, you may support yourself either through superannuation, pensions, or savings or take help from your family. In most cases the money is provided by the government by a scheme like social security. Sometimes you get pension from your private employer also. Early Retirement You can take early retirement at any age, but is generally before the age needed for eligibility for support and funds from government or employer-provided sources. Thus, if you retire early, you will have to rely on your own savings and investments to be initially self-supporting, until you start receiving external support from the schemes by state or your employer.You need savings for early retirement. Life after retirement Retirement changes your life. Your economical, social, physical, emotional state changes. You have a new life. Retirement might coincide with important life changes. You might move to a new location, for example a specialised retirement facility like assisted living, retirement home, nursing home, independent living etc. While selecting the living option, be extra cautious because you will be living there and you my not be able to change as and when you want to. Many people in the later years of their lives, due to failing health, require assistance, the highest degree of assistance is being provided in a nursing home. Those who need care, but are not in need of constant assistance, may choose to live in a retirement home. This gives the retired person some degree of freedom, yet with close-by medical assistance to handle emergencies.

How should you prepare for retirement?

The three major elements of your retirement portfolio are benefits from pensions, savings and investments, and Social Security benefits

Planning for your retirement

You should plan for your retirement. This planning will include when to retire, how much money you should have for future, what will be you retirement living source, in which options to invest money etc.Source of future finance is important. You may get money form your social security system or from your employer through the scheme like 401 (k) plans. In private schemes like 401 (K) plans you set aside money for future and you employer also may contribute or may not. So find out whether they contribute it or not. Then find out how much money you will receive from these two sources from the state and from private sources. Put aside maximum money possible in these schemes.Get all the information needed about Social Security eligibility and apply for it.

Social Security may be great help for you. Social Security planner provides detailed information about your Social Security retirement benefits under current law and points out things you may want to consider as you prepare for the future.


When you still have time for retirement, find out about your retirement ages, the benefits, learn about Social Security programs. You may use benefit calculators to test out different retirement ages or future earning amounts.If you are already near retirement age, you can discover your retirement options, get information about how members of your family may qualify for benefits, find instructions on how to apply for benefits and what supporting documents you'll need to furnish, and then apply for retirement benefits. A comfortable and secure retirement is every worker's dream. And now you are living longer, healthier lives and so you can expect to spend more time in retirement than your parents and grandparents did. Planning retirement makes this dream possible for you.

Bikash is an MBA who works as an freelance writer. He worked for one of the best private banks in India. He has been writing for the last 5 years. He has worked with many US,UK and Indian clients.
Visit him at http://bikiassam.tripod.com