Retirement is a huge milestone in one’s career. While it provides time and leisure to indulge, it also brings about a certain amount of responsibility. It is therefore imperative to not only choose to plan but also choose the right plan while at it. Many of us believe that our PPF (Public Provident Fund) would suffice and go on resting in an auto-pilot mode, but in reality, the inflation factor will catch up before we know.
We at MAXX Markets recommend investing in a plan as early as possible so that longevity and flexibility come into picture. This allows us to expand and hike up contributions as the income increases. While there are several plans available, MAXX Markets lists out a few factors to consider choosing the perfect retirement plan. A plan that fits the bill and is dedicated to one’s needs perfectly.
Trading as a key factor:
Rigorous studies by trade pundits all over the world show that equities provide considerable value to a plan’s portfolio as opposed to assets such as gold and property. While the latter do provide stability and cannot be ruled out by any means, equities along with them provide even more stability. Also, it is to be noted that in many scenarios, traders can borrow money from their qualified retirement plan to start a business (trading) or even pay off a debt.
An estimation of the retirement budget will bring in more clarity. Though it isn’t easy to guess the outcome of the future, it is certainly advised to have a clear picture as to where one stands. Deciding on a retirement age and estimating the current expenditure (both big and small) will help in the long run. Our experts at MAXX Markets can help by including factors like current income and average inflation rate and create a solid plan.
ROI v/s Rate of Inflation:
Capital Erosion is a phenomenon where the Return on Investment (ROI) is lesser than the rate of inflation. This needs to be avoided by investing in areas that fetch higher returns that prevailing inflation rate.
Debt and Expenses Analysis:
Debt is one of the primary factors to drain out income and it comes in many ways; high interest credit cards, mortgages and other loans. It is advised to clear debt before retirement to aid a more polished plan.
Expenses are part of lives and cannot be avoided. Post retirement expenses, especially, come with uncertainty. It is therefore recommended to estimate these expenses beforehand and proceed with more preparation. This allows us to also determine out retirement income and needs. The current expenses trend can be used as a base to etch out the plan.
Options for Investment:
MAXX Markets believes that a major portion of the retirement plan must be equity-oriented investments in the initial years to earn a high return and a small part could be allotted to debt instruments. The same process could be turned around by cutting down the equity investments. You can also opt for trading crypto-currencies online on trustworthy platforms such as B-Finance.
To sum it up, creating a dedicated retirement plan is the call of the day and it must cover all the factors mentioned above. It is certainly recommended to keep the long term investments right and plan for post –retirement property well in advance.