Retirement

Facts Of Retirement

Having a peaceful life after retirement is a dream everyone wish to have right? Retirement could have multiple meanings depending on person to person. For a few it might relate to travel and explore places with their family members or for others it may be starting a new business or any other Retirement goal of that matter. For all these goals you wish to accomplish- Let’s have a look on a few surprising facts about retirement. Successful retirement planning requires consistent savings to provide for a time when income is no longer generated from your job. Seniors aged 75 and above spend a lot time seeing TV, on average about 5 hours a day. You’ll still pay (some) income tax in retirement Many people are not confident that retirement will be comfortable Many people have little or no r...

Portfolio and your retirement lifestyle

Portfolios are usually constructed based on the individual’s investment objectives, the risk tolerance and the time horizon. Investors can feel confident that they own a well-diversified portfolio but only if they use these inputs and portfolio optimization calculations, so that they pursue their long term goals. As a retiree, your retirement goals play a major role in building your portfolio. Starting a business? If retirement funds are used to start a business it entails your risk. You might want to consider reducing risk levels of your investment portfolio to compensate for risks for a new business venture. Of course a new business cannot generate income right away and hence you might want to construct a portfolio which is income oriented and provide you for your current income till the...

Women and retirement

Many women are the primary breadwinner in their house but yet just a few are confident in their ability to fully retire with a lifestyle of their comfort. When it comes to retirement, women may even leave their future to chance. College: The reason behind difference is not lack of education or independence. In fact more than men, women go to colleges and graduate. So why are they away from taking charge of their long-term financial picture? It may be due to lack of confidence. Only a few women say that they are confident enough when they talk about money and finances with advisors and professionals. Women may step back from discussing about retirement as they feel that they shall appear uneducated or naïve and hence hesitates to ask questions. Facts of women and retirement- Women are almos...

Ever Heard Of This Investment Risk?

Investors are aware that investing in capital markets may present any number of risks such as Interest rate risks, company risk, market risk etc. Risk is not a separable companion for long-term growth. Some of the risks can be mitigated by the method of diversification. Also you may face another less known risk as an investor for which neither the market compensate you nor can it easily be reduced by diversification.  Yet it might be the biggest challenge to the sustainability of your retirement income. This risk is called the SEQUENCE OF RETURNS RISK. The uncertainty of the order of returns which an investor shall receive over a period of time refers to sequence of returns risk. “Never try to walk across a river just because it has an average depth of four feet”. For an example- say a mar...

How to Double Your Investment?

There’s something that intrigues most investors by the idea of doubling one’s money. Doubling your money is a realistic goal that investors must always be moving towards, as well as something that can lure people into impulsive mistakes regarding investing. Here we shall look at the right and the wrong ways to invest for huge returns. THE SUPERIOR WAY- EARN IT SLOWLY To double your money, the most tested way over a reasonable time is to invest your money in a solid, non-speculative portfolio that diversifies between investment grade bonds and blue chip stocks. The portfolio won’t get doubled in a year, but will surely do eventually. The old rule of 72 helps you calculate the time it would take for your investment to get doubled if its growth compound itself. According to rule 72 you got to...

Retirement Income & the Conventional Portfolio

Experiencing negative returns early in retirement could deplete your portfolio quickly. For this, you might want a couple of strategies to help mitigate this concern. LIQUID ASSETS It is required to have a pool of very liquid assets to fund two-to-three years of retirement spending which could help you from selling long term assets at an inopportune time. Through time, and depending on market conditions, you might have the opportunity to replenish this cash reserve using gains from your retirement portfolio ANNUITIES Another complementary strategy is to integrate annuities. This could help you to shift the risk of market volatility off your shoulders. The guarantees of an annuity contract depend on the issuing company’s claims-paying ability. Annuities have contract limitations, charges &a...

Your Emergency Fund- Is It enough?

Have you ever experienced one of those days wherein the water heater stops heating, dishwasher stops washing & your family ends up on a first-name basis with the nurse at urgent care. Then, as you are driving to work you see smoke seeping out from under your hood. Bad things happen to the best of us, & instead of spacing themselves out, they almost always come in waves. It is important to have a financial life preserver, in form of an emergency cash fund. Many people know that an emergency fund is an important resource but at the same time they area nit sure about how much to save or where to keep the money. Others wonder how they can find any extra cash to sock away. HOW MUCH MONEY? How much is enough to set a target amount for starting an emergency fund?  Unfortunately, there is ...

Reasons Why You Should Start Planning For Your Personal Finance

Personal finance includes all the financial decisions and activities of an individual or household, including budgeting, insurance, mortgage planning, savings and retirement planning. It is basically application of principles of various monetary decisions of an individual or family unit. For planning your personal finance, you need to know what importance it plays in building wealth. UNDERSTANDING THE BASICS OF PERSONAL FINANCE: Balancing your checkbook, making of personal budget, investment techniques and creation of emergency funds, these all makes up your personal finance basics and you need it to master it all.  BANDING TOGETHER YOUR GOALS WITH YOUR PERSONAL FINANCE PLANS: Planning your finance in such a way that it collaborates with your goals. Personal financial planning is made out ...

Few Things To Know About Financial Year End

What is financial year end? In India, the government’s financial year runs from 1 April to 31 March. It is abbreviated as FY17. Companies following the Indian Depositary Receipt (IDR) are given freedom to choose their financial year. For example, Standard Charterer’s IDR follows the UK calendar despite being listed in India. Companies following Indian fiscal year get to know their economical health on 31 March of every Indian financial or fiscal year. The current fiscal year was adopted by the colonial British government in 1867 to align India’s financial year with that of the British Empire. Prior to 1867, India followed a fiscal year that ran from 1 May to 30 April. A fiscal year (or financial year, or sometimes budget year) is the period used by governments for accounting an...

Retirement Planning – Not Something That You Defer

Retirement – will mostly happen someday or the other.  But have we done our work on that? Can we do anything to increase the retirement incomes & savings? Yes, we can!  No matter where we are on the road to retirement, we have three tools at our disposal:  Save More Increase your savings rate. Save more while you can. Keep increasing the savings basis your increase in income.  It will surely show you the results in the future.  Time Is Precious – Use It Wisely The new workforce generation may think they have a long time to save for retirement, but, as an old adage says “The early bird always catches the worm”, starting to save late wastes one of the most important assets, ie, time. Time helps investments do their work by compounding returns & growing the wealth. With changes in hea...

The Master Key For Your Financial Plan: Womens Day Special!

We all look up to strong, independent women. But how do we become one ourselves? Its easy to give in to feelings of self-doubt and back down from challenges. But that’s certainly not what being a strong woman is all about.We all know we’re different from men in some fundamental ways. But is this true when it comes to financial planning? In a word, yes. In the financial world, we often find ourselves in very different circumstances than our male counterparts. Everyone wants financial security. Yet we often face financial headwinds that can affect our ability to achieve it. CHALLENGES FACED BY WOMEN IN FINANCIAL PLANNING: Financially speaking,  women have longer life expectancies. Women live an average of 4.8 years longer than men. A longer life expectancy presents several financial challeng...

Have You Started Your Financial Planning?

We all have dreams, be it owning a car, a house, child attending a prestigious college or building a healthy retirement corpus. But we seldom pen down these goals and work towards a plan for achieving them. These can be termed as your life goals. And that is where the importance of a financial plan comes into the picture.  Financial planning is a process of determining your financial goals with the help of  available resources in a period of time. Financial planning involves wealth management , tax planning , estate planning, retirement planning ,investment planning , insurance planning and cash flow planning.   Need For Financial Plan : A financial plan Helps you to make the right investment decisions which helps you to grow your money A financial plan gives you a clear picture of how muc...

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