Tips on How to Plan for Retirement in Your 30s

Investing for your retirement is a slow process and that is completely fine as long as you have a nice nest egg when you retire. It is especially difficult to save up for your retirement when you are in your 30s but every rupee counts. The sooner you start saving up for your retirement the better. In your 30’s,
you have more or less stabilized your life and can freely start investing and thinking about your future. With three decades in your hand before retirement, you have a long way to go.

Here are a few tips to kick start your retirement planning habits when you are in your 30s:

• Don’t rely on cash-only savings:Almost everyone want to play safe and rely on cash savings. Even though having cash on hand is a smart decision as you might require it in case of an emergency, but keeping your money in a savings account won’t do you much good either. You will be losing your purchasing power to inflation and hence will be losing out on any opportunity to let your wealth grow. But you still have time on your hands and it is better if you invest your money in stocks. Long-term returns have always proved to be profitable and you have the luxury of time by your side.

• Retirement Plans:You should start investing money in your company provident fund or a public provident fund regularly to let your money grow. Now is the time to invest regularly in these funds so that you can have a substantial amount to look forward to when you finally retire. Along with that,
  these funds also help you compound the sum invested, allowing it to grow very fast. So, again with time by your side you will be able to have a nice corpus for your retirement fund by the time you retire.

• Automated Contribution:Most people tend to overlook their retirement needs when they are in their 30s and start panicking in their early 50s. If you do not want that to happen, you should save small but save regularly. Opt for an automated contribution plan that will force you to build up your retirement fund and bump it up every time your earnings increase.

• Emergency Funds You should always have a rainy day fund or an emergency fund in place. Your emergency fund should grow along with your income and you should keep contributing to it so that you have a large sum ready in case of any emergency. From medical emergencies to a home repair, anything can happen anytime so if you have an emergency fund in place, you will be able to bear all the expenses hassle-free.

If you have not reached the point where your emergency savings are more than enough and your retirement plans are met, you should keep contributing to your future and build up your funds one rupee at a time.