Nov 06, 2023 6 min read

How to do Retirement Planning in India

Planning for retirement is necessary, even if you are earning well now. Money doesn’t occur in old age magically; you have to plan it. Retirement planning is like making a money plan. You decide where your money will come from, how much you'll spend, and how to save for the future. You can even use Mutual Fund to save for retirement while still enjoying the things you like today. In this blog, we’ll explore the steps to create an effective retirement plan that will help you secure.

What is Retirement Planning?

Retirement planning is like taking care of your money for when you're older, around 60 or so. It's all about making sure you can live independently and make your dreams come true. First, you save and invest your money so that it can grow and become a nice sum for your retirement. Second, the post-retirement phase is the distribution phase this stage involves structuring your finances to provide a steady income stream, which can cover your projected expenses like medical bills, daily living expenses, and travel to pilgrim places.

You don't need to think about retirement planning as soon as you start earning money. Putting it off till later in life can be a manageable task. Remember that staying organized is always beneficial.  Even though you can't control everything in life, it's a good idea to prepare for unexpected events. One way to do this is by investing an Online SIP in a mutual fund.

SIP allows you to put a set amount of money into mutual funds on a regular schedule. You can do this monthly, every three months, or even twice a year, depending on what suits you best.

In simple words, retirement is like a money plan for your future. It helps you save, spend, and invest for your long-term goals. You can use various financial tools based on your preferences to assist with your retirement plan.

Why Retirement Planning is Important?

Planning for retirement significantly impacts your quality of life once you stop working. It's a vital financial task.  It is important for several compelling reasons:

Financial Security

Retirement planning ensures you have a stable source of income when you no longer earn a salary. You may struggle to pay for everyday expenses and medical bills if you don't have a plan. So to create a plan for financial security you might invest in online SIP in mutual funds.

To Reach Your Retirement Objectives

When you have time to do things like travel, try new hobbies, or even start your own business, it's a great time in life. Yet, you might also have responsibilities like paying for your children's weddings. Without a plan, it can be tough to cover your daily expenses and medical bills.

Inflation Mitigation

Money loses value over time due to rising inflation.  Retirement planning maintains your purchasing power by making sure your savings exceed inflation.  You can pick a retirement plan that fights inflation, like a mutual fund.

Longer Life Expectancy

Modern healthcare has made people live longer, so your retirement savings must also last longer.  Adequate planning ensures you won’t outlive your resources.

Peace of Mind

Knowing that your financial future is secure provides peace of mind. You can approach retirement with confidence, free from financial worries.

Unforeseen Events

Life is unpredictable. Saving money for retirement can be a real lifesaver when you encounter unexpected financial issues, such as sudden emergencies or when the economy isn't doing well. It's like having a financial safety net.


Retirement planning empowers you to maintain your independence. You won’t have to rely on others for financial support.

4 Steps of Retirement Planning

How to invest to achieve a secure retirement is here

1. Define your Retirement lifestyle

In the journey of retirement planning, the first and most crucial step is to define your retirement lifestyle. This involves setting clear and realistic goals to help you create a financial roadmap tailored to your unique needs and desires. Ask yourself questions like

  • Where do you want to live after retirement
  • What kind of lifestyle do you envision during retirement?
  • Do you have a specific desire, such as traveling or buying a second home?
  • Do you have Specific Financial Goals?
  • Will You Have Debts to Pays Off
  • How Will You Handle Inflation 

Asking and thinking about these questions helps you create a detailed retirement plan that’s customized just for you.

2. Calculate Your Retirement Time Left

Preparing for your retirement is vital for your financial security, no matter what job you do. If you are in the private or government sector. To calculate the time left until your retirement, you need to consider various factors, such as your current age, desired retirement age, life expectancy, and financial resources. consider how much money you'll need for your post retirement life and for the years you won't be earning a regular income. This helps you make a good plan, ensuring you'll have enough money to enjoy your retirement without worries and ensuring you have the financial security and peace of mind you need in your post-retirement years.

3. Calculate Your Investment Amount

To figure out how much money you'll need to save for a stress-free retirement, you can use a tool like the SIP Retirement calculator. Start by entering your current age and estimate how much you spend annually on things like medical expenses and travel. Then, the calculator multiplies this yearly spending by the number of years you expect to be in retirement. The calculator will calculate your risk appetite, and take the compounding growth rate to do the reverse calculation which will calculate your exact monthly investment amount. So that it can create a wealth that matches the amount of retirement corpus.

4. Create Your Portfolio

Now invest in those asset classes that can compound and create your desired corpus, there are many investment options but in a Mutual Fund that Compounds money with a good growth rate, and is professionally managed by the fund manager, diversifies your money in asset classes like equity, debt, gold, etc. This strategy combines the power of compounding, professional management, and risk mitigation for effective long-term financial planning.

To create a diversified portfolio of mutual funds, you should consider investing in a mix of funds that cover various asset classes and investment styles. Like Best Equity Fund are good for wealth creation and debt funds that keep your market risk controlled.

It's important to ensure that your investments continue to align with your long-term goals, life expenses, and risk tolerance. Reviewing your portfolio periodically allows you to make necessary adjustments to keep it on track.


Retirement planning is vital for securing your future. Save, invest, and create an income stream for post-retirement expenses. It's essential for financial security, achieving your goals, and combating inflation. Follow six steps: Define your retirement lifestyle, calculate your time left, determine your target corpus, use tools like SIP Retirement Calculators, create a diversified mutual fund portfolio, and manage it regularly. In today's uncertain world, a robust retirement plan is your financial anchor for the golden years ahead. Start planning today to secure your future.

Read More : What Is Systematic Investment Plan (SIP)?

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