Things to check while planning your retirement

The beautiful thing about personal finance is that it lets you look at your financial life not only at the micro level but also gives you a bird’s eye view. While you think of your financial life stages, each stage is not a destination but a transition from the previous phase. Retirement is not a destination but just a transition from your pre-retirement life. Nevertheless, it is really important to plan for your retirement in your pre-retirement life as the retirement phase stays for almost the same number of years as the pre-retirement phase and that too with low or almost no regular income. So, here are a few things that you should check while planning your retirement.

Life expectancy
Retirement planning is based on assumptions. So, you should be near to perfection while assuming certain things. One such assumption is your life expectancy. It is a general practice of many financial planners around the globe that they usually consider the average life expectancy in the region their client resides in. However, it is not a good assumption to make. Always while making any assumptions, it is wise to be at the conservative end. So, while considering your life expectancy, be conservative and assume your life expectancy at 100. This often would help you in avoiding outliving your retirement corpus.

Inflation
Inflation is something that needs to be factored in while determining the retirement corpus that you would require at the time of retirement. However, here you need to check whether you have assumed the right inflation rate or not. Relying on general inflation would be a foolish thing to do. Rather, it is better to calculate your personal inflation. Considering personal inflation would help you in determining the near to perfect retirement corpus that you might need in your retirement phase.

Strategy
It is rightly said that “a goal without a plan is just a wish”. Similarly, retirement planning is worthless if you don’t have a proper retirement strategy in place. Here you need to check whether you are following the right retirement strategy or not. In case of personal finances, no size fits all. So, you need to look into your financial situation and follow a retirement strategy that would suit your financial situation and requirements. It is always prudent to first concentrate on having a desired regular income and then the remaining assets to be aimed towards achieving other financial goals while in retirement.