Retirement Planning: FD Returns Are Not Enough, Robust Retirement Planning is Essential Now!

Retirement Planning In India: For a 50-year-old investor, relying solely on FDs can make retirement insecure. Inflation is rising rapidly, and today's monthly expenses of Rs. 60,000 will likely become Rs. 80,000 in five years. Experts believe that approximately Rs. 1.83 crore will be needed for a comfortable retirement, while an FD of Rs. 80 lakh only covers half of this requirement. Therefore, growth options like equity and hybrid funds, which can provide returns of up to 9-11%, are essential alongside FDs. With proper planning, an emergency fund, and health insurance, a secure and worry-free retirement is possible.

Retirement Planning In India: Today's young generation dreams of early retirement, but the real question is whether our savings will be enough to fulfill that dream. If a 50-year-old person wants to retire at 55 with Rs. 80 lakh in FDs, is it possible? At first glance, this amount seems sufficient, but the reality is quite different.

How much burden will inflation put on your finances in the future?

Today's monthly expenses of Rs. 60,000 will reach approximately Rs. 80,000 in five years. Inflation silently increases your expenses every year, whether it's for groceries, medicines, or daily necessities. Experts say that approximately Rs. 1.83 crore may be needed to live comfortably from the age of 55 to 75. The returns from simply keeping money in FDs prove to be very weak compared to inflation.

Why is keeping money only in FDs risky?

The 6-7% interest earned on FDs decreases further after taxes. Moreover, prices are constantly rising, while the return on FDs remains almost constant. Because of this, a fund of Rs. 80 lakh only covers half of the retirement needs. This means there is a risk of running out of money before the age of 70. So what's the solution? What else can be added to an FD?

Investing only in safe options doesn't grow your money; it merely preserves it. Experts advise that along with FDs, a portion of your investment should be in equity and hybrid mutual funds to generate returns of 9-11%. This makes it easier to build a corpus of over ₹1 crore and reduces the fear of running out of funds during retirement.

Even after retirement, it's essential to keep 20-30% of your money in growth-oriented schemes to comfortably manage expenses during times of inflation. Additionally, a 3-6 month emergency fund and good health insurance provide significant support.

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