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Plan Ahead :Good Investments for Financing Your Retirement

Updated on July 8, 2011
Get your nest egg
Get your nest egg

Saving Habits

Do you save on a regular basis

See results

Gold is Gold

This is a great way to invest
This is a great way to invest

Pick the right one

Mutual Funds are a good investment if made wisely
Mutual Funds are a good investment if made wisely

Planning is the Key

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.

What investments to make

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.


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    • cashmere profile image

      cashmere 6 years ago from India

      Thank you. I follow what I preach to a large extent

    • AllSuretyBonds profile image

      AllSuretyBonds 6 years ago

      Great Hub. Good tips and advice on planning and financing for your retirement. I agree with you that you should start as early as you can. I think alot of people wait to long to start planning for retirement.

    • cashmere profile image

      cashmere 8 years ago from India

      That's the whole point Jessica, save something, anything! Whatever you save is a bonus.

    • Jessica Horn profile image

      Jessica Horn 8 years ago

      Great tips! I'm in the middle of a Dave Ramsey financial course at our church. The only thing I see that is different is that 40% toward savings/investments might seem very difficult for some, but even just saving 10% can make someone who makes minimum wage a millionaire - over a long period of time.

      The key is to always make a point of saving SOMETHING.

      Great post. Thanks for sharing.

    • cashmere profile image

      cashmere 8 years ago from India

      That's good ellen_c, the faster you begin, the better it is.

    • Ellen_C profile image

      Ellen_C 8 years ago

      good advice I am already saving

    • cashmere profile image

      cashmere 8 years ago from India

      thanks everyone!

    • Kimberly Bunch profile image

      Kimberly Bunch 8 years ago from EAST WENATCHEE

      Very Good one. Here's what I wrote:

    • free4india profile image

      free4india 8 years ago

      Congrats your pageviews on hubpages have hit 10,000 mark.

    • naveenkadian profile image

      naveenkadian 8 years ago from NJ, USA

      You have done a great work your hub nice and very informative glad to read it and waiting for next one.

    • alekhouse profile image

      Nancy Hinchliff 8 years ago from Essex Junction, Vermont

      I am not a saver. My parents were not and they never taught me to be. I've struggled with this all my life. The only time I was successful was when I was saving for a down payment on a house. I opened up an annuity and saved enough in 7 years to buy a beautiful, historic home. But, since then, no luck. Your hub has a lot of good advice. Thanks.

    • profile image

      docadvocate 8 years ago

      though i haven't gien a thought to it but ur hub has made me think of it.thanks

    • bingskee profile image

      bingskee 8 years ago from Quezon City, Philippines

      how i wish i could save some but for now it's impossible..

    • BrianS profile image

      Brian Stephens 8 years ago from Castelnaudary, France

      Very good advice for anyone and worth pointing out that the sooner you start saving towards your retirement the more effective that investment will be, as long as it is a sensible investment. Many people wait far too long to start saving for their retirement and struggle to accumulate a meaningful sum by the time they reach retirement age.