Stay Financially Independent After Your Retirement

1. Draft a budget: This is the first and the most difficult step while planning for your retirement. Opinions vary on how much money is needed to retire comfortably — some experts argue that you should be shooting for eight times your ending salary, while others say you should be building toward Rs. 1 million. In reality, your retirement savings are very particular to you, so there's not really a one-size-fits-all approach. What's most important is that you determine the exact amount that you need to save for, so there's no guesswork; then you can start building your plan around that number.

1. Increase your savings: Generally, experts recommend that you save between 10 and 15 percent of your yearly income for retirement, but that might not actually be enough, especially if you're getting a late start. Start upping the ante: see if you can start socking away 20 percent from your payment alone. If the added financial discipline is hard to muster, set up an external savings account and have a portion of your paycheck automatically deposited there.

1. Reduce your debt: Tackle any outstanding debt you have and prioritize by starting with high-interest loans first, like credit cards. Seek out alternative solutions if your debt is too large, or it could compromise your retirement. See if you can consolidate your debt in a zero-interest card or low-interest personal loan.

1. Do not spend too much: Before you retire, make saving a habit. Do not shop frequently but buy things only when you need them the most.

1. Make use of employee benefits: Retirement planning doesn't involve just saving money. It also requires making sure you have safety nets in place. You need to maximize your employer benefits such as disability insurance, life insurance and health insurance. If you're not offered enough coverage through your employer, consider buying policies on your own.

Make use of pension calculator for retirement:

There are pension calculators available online which help you calculate the amount you need to live comfortably post retirement. Take advantage of this calculator to calculate how much you need to save before your retire. Pension Calculator helps you calculate your income requirements post retirement on the basis of your age, annual income, savings, nature of accommodation, and the expected growth rate. Pension Calculator basically helps you determine the monthly amount you need to invest towards a retirement plan, in order to meet your financial needs during your golden years.

The following are the key inputs you need to key in the Pension Calculator in order to get viable results:

1. Date of birth: The date of birth you need to enter in this field of the Pension Calculator is majorly for record keeping purposes. Therefore, in order to get the most reliable results from the Pension Calculator, make sure you enter your date of birth as per your government IDs.
2. Retirement age field: While the official age of retirement as per the government norms is 60 years for the salaried people, the Pension Calculator allows you to choose the retirement age as per your desire. This feature has been incorporated in the Pension Calculator keeping the self-employed people in mind as well the increasing trend of voluntary or early retirement.
3. Annual income field: In terms of annual income, you would be better placed to consider your net income instead of your gross income while using the Pension Calculator.
4. Savings field: Please mention the savings you have in this field.
5. Post retirement accommodation field: In this field of the Pension Calculator you are required to mention the nature of your accommodation after retirement.