The greatest fear of senior citizens after retirement is Managing their finances. People who work hard their whole life often forget they have a life after retirement. Improper financial planning for their years to come can lead to financial crisis at the time of need.
Financial planning doesn't mean you need to have a huge bank balance. Every family has a different financial need and purpose. Here are few important points for seniors to focus on after retirement for a peaceful and stress free life.
Why is financial planning important after retirement?
Inflation: Inflation is generally defined as the increase (or) rise in price level after a period of time. For example, if you can buy two properties with the money you have today , you can only buy one property with the same money after 5 -10 years. Inorder to overcome inflation our savings (or) income also has to grow.
Surging Medical costs: As people age , health problems also start to grow with us. In Order to take care of all the medical expenses proper financial planning is important.
No pension: India has now turned into a non pensioned society. There have been years where people after retirement were only reliable on pension and it also served their cause. In today’s non pensioned society proper planning is highly important.
Investments:
Investments (or) investing on something is the right key for secured life after retirement. The two ideal benefits of investment are regular sources of income and accumulation of wealth. Obviously, seniors might not need both the benefits.
Pensioners might only need not really concentrate on a constant source of income rather they can concentrate on building their wealth. Whereas people without the source of constant income (or) pension might need to concentrate on investment. Here are few investment options for seniors,
Fixed Deposits: Fixed deposits (or) FD’s for senior citizens are specially allocated for seniors, which have a high rate of interest compared to regular FD’s. Seniors are also allowed to withdraw a specific amount of cash monthly ( only in FD’s allotted for seniors) which acts as a source of income to them.
Recurring Deposits : Recurring deposits (or) RD’s for seniors are yet another option for investments. Recurring deposits are the right choice for salaried individuals who have a regular source of income.
Senior citizen saving schemes: SCSS (or) senior citizen saving schemes are offered by post offices and other banks. SCSS not only offers seniors with higher rates of interest but also provides additional tax benefits.
Life Insurance:
Life insurance serves as an alternative for seniors who do not have a pension (or) monthly income after their period of retirement. Life insurance also acts as a back-up plan if incase one of the seniors tends to die, it may be a savior for their spouse and family members. 60PlusIndia offers the best health insurance for seniors.
Benefits of life insurance plan for seniors:
Reduces their financial burden: Insurance policies usually provide all sorts of immediate expenses like medical expenses which reduces the financial burden in seniors.
Makes them self reliant: A Lot of seniors after their retirement depend on their family members. Yet a lot of seniors hesitate to depend on others as it affects their dignity. Insurance plans make them more self-reliant and confident.
Acts as a source of funds: Insurance policies acts as a source of funds for funeral expenses, medical expenses, etc.
Rental Income: Rental income is one of popular sources of income for seniors, especially in india. Even Though, rental income does not need big efforts from our side it has its own challenges.
Challenges faced by managing a rental property:
Property Management: owning a rental property needs time to time renovation to maintain its shape and quality. Owning a rental property doesn't mean your job is done after the tenant occupies the property, it starts only after that. There may be time to time issues like water pipe leakage, bore well not working, etc. Managing the property needs more attention than renting it. 60plusindia offers property management services to take care of their properties, tax payment and maintenance.
Finding the right tenant: Finding the right tenant is the major step in renting a property. Certain tenants may not pay their rents on time, might leave the property damaged, might cause serious troubles, etc.
Unreliable at times: Renting an property might sometimes become unreliable. In situations like a tenant vacating all of a sudden, No suitable tenant available.
In the above contents, we have discussed why and how financial planning plays a major role after retirement.Hope this valuable information would be useful for you in living a peaceful and stress free life after retirement.
Author : Team 60plus India
Keywords: Investment, planning, financial planning, expenses , income , rental income, seniors,retirement, pension.
Tags: #seniors #seniorcitzen #retirement #investment #income #finances #financialplanning #expenses #rental #rentalproperty #rentalincome #income #pension
