Have A Plan

When I was little I had heard the story of the hardworking ant and the playful grasshopper. The lesson there was that the ant worked hard all summer and prepared for the coming winter.

While the grasshopper played all summer and had no food when winter came.So the moral of the story was that you had to plan ahead and work to the plan.

That's exactly how retirement planning works. You need to get a plan that suits your financial situation and then get it working.

Start Saving Now

It is always possible to save some money. Don't think that you need to invest a huge amount of money to begin saving. When I first started saving it was with just Rs.500, or merely $10 per month.

It was not a huge sum, but it added up. It is the cumulative effect of saving the money that gets you a lump sum to invest in a better scheme.

It also does not pinch you on a monthly basis. Plus it instills in you a sense of discipline that spills over into your financial planning as well.

Invest in Safe Bets

We all want to get rich quick. Any idea that says that you can make money fast will pique our interest. The truth is that these get rich quick schemes usually don't work well.

In most cases you find it tough to even recover your initial investments.So stick to safe bets while investing your hard earned money.

I usually trust the post office recurring deposits, bank fixed deposits, mutual funds from reputed houses, pure gold from banks, life insurance and public provident funds.

Use the 60-40 Rule

You must try out the 60-40 rule, by keeping 60 percent of your income for regular use and 40 percent of your income for investing. That way you always invest some money with every income.

No matter what the source of income is. It could be your salary, a gift from your family, some bonus that you came into, and any thing else that brings money into your life.

So you know for certain that 40 percent of the income is being saved. It will all add up in the end.

So that's how I feel you need to plan for your retirement. By making the right investments and making them regularly.

As the savings tools differ from country to country here is what I feel works well in India right now.

Post Office Recurring Deposits

These can be for as little as ten rupees a month and go upto any amount you are comfortable with. The term is for 5 years, so you need to be able to put aside the same predetermined amount each month for all the years.

Bank Fixed Deposits

These can be for as little as a couple of thousand rupees and can be for any time from 6 months to 10 years. The interest rates will vary depending on the

Public Provident Fund

This is a savings device that also helps you with your tax savings. Plus you only need to put in five hundred rupees into the account each year to keep it going. If you have any extra money available you can bung it in as well.

Gold Coins

Naturally gold is a very good savings option. The price never comes down. So it makes a very good investment. Just make sure that you buy 99.9% pure gold of 24 k so that you don't lose any money on your rather costly investment.