If you want a secured, comfortable post-retirement life, you need to plan your retirement so that that plan easily supports all the finances. Your retirement finances depend on how well you prepare it during your active years. Also, while you plan it, you need to consider your retirement goals and the time required to accumulate the required amount.

There are various types of retirement accounts offered by banks and financial institutions to help you raise money to make your future financially secured. Merely saving the funds won’t allow you to get sufficient funds for your future. You need to invest your money in places that will help you grow that money.

Tax plays an important role while you plan your retirement. The fun part is when you save a particular amount towards your retirement planning account, you receive a tax deduction on it. But you must pay a certain tax when you withdraw the same money in your retirement years. There are certain ways by which you can reduce the retirement tax hit while you are in the saving period.

Let’s see the five basic steps that everyone must take to plan retirement efficiently irrespective of their age.

Estimate your expenses

It is important to pen down your future expenses one by one to have a financial backing to cover them in your retirement years. You might not have sufficient funds in your active working years, but you can spend your post-retirement life as per your expectations with comfort only if you plan it well. Whatever be your dream, a world tour with your spouse, or owning a house in your home-town or even a destination wedding, it is possible to achieve with a proper retirement plan. All you need to do is list down all such events, the timeline at which you want to achieve it, and the necessary fund.

Create funds for unexpected events

Unplanned expenditures can burn a hole in your pocket. You plan for various dreams and scheduled events, which makes it easy to accumulate funds accordingly. In comparison, it is difficult to plan for unexpected events like medical emergencies or any other unforeseen circumstances. Such expenses can significantly affect your savings, so you need to keep funds aside for such unexpected expenses.

Spread your investment horizon and consider instruments

Most of the traditional advisors suggest investing in low-risk investment instruments. Low-risk investment instruments can secure your money, but if you think about growing that money to meet your future expenses, it is not beneficial. Hence, refrain from choosing low-risk investment instruments when it comes to retirement planning. Also, consider the inflation factor as it rapidly eats your savings.

Avoid breaking your retirement corpus in between

There might be various situations where you might feel like using your retirement corpus to suffice your current needs. We suggest unless it is crucial, it is better to avoid breaking your retirement corpus before time. Remember to refrain from withdrawing money from the PF account as each time you withdraw money from PF instead of transferring it, your retirement funds suffer.

Start as early as possible

The sooner you start, the more corpus you accumulate. It is important to treat saving for your retirement corpus as seriously as current needs. Even a small amount saved toward a retirementplan from a young age counts significantly in retrospect.