loader2
Partner With Us NRI

5 Ways to Build a Substantial Retirement Corpus

Introduction

Regardless of whether you just started a new career or you’re almost through, you still have the potential of building your nest egg. Ideally, the sooner you start saving for your retirement, the more money you could earn due to the power of compounding. But it’s never too late to begin. Let’s look at five pointers to help you boost your savings and follow your retirement dream.

1. Know how much you may need

Take the help of a retirement calculator, a handy online tool that gives you an instant snapshot of how much money you may need for your retirement. It can also help in identifying surpluses and gaps. To use an online retirement calculator, all you need to do is enter your current annual income, frequency, current retirement savings, current age and desired retirement age to see an approximate retirement amount. Ideally, consulting a financial advisor can be a massive help if you’re looking to build a customised financial plan for your retirement.

2. Begin today

If you’re new to saving for your retirement, start today with as much as possible to enable compound interest to work in your favour. The magic of compounding is the ability of your investments to generate earnings that are reinvested, which further generate their own returns. Hence, the earlier you start saving and investing, the more compounding works for your money. So even if it means starting to invest with a small amount, it can substantially impact your investment results if you have a long time horizon in view.

3. Automate your savings/investments

You’ve probably heard the saying “pay yourself first.” That means saving for yourself at the start of the month when you receive your income. Use a Systematic Investment Plan [SIP] in mutual funds when saving for your retirement. A SIP automatically deducts the amount from your savings account towards the desired fund of your choice. It allows you to potentially grow your nest egg without having to worry about it. 

Additional read: How to accumulate Rs. 2 crores for your retirement

4. Control expenses

Take a thorough look at your budget and examine areas that show where your money is going. Look for places where you can minimise spending so that you have an additional amount to set aside for savings or investments. For instance, you may want to cut down on dining out and other discretionary expenses and forward those savings to contribute to your retirement fund, which in the long run can make a huge difference.

5. Identify new income sources

Your customised retirement plan must offer you a sustainable portfolio that provides you with a sufficient income stream in your retirement years. Look into all your retirement resources and estimate how long these assets will last based on your retirement budget, time horizon, and other considerations.

Some retirees often regret they’ve started too late and saved too little. But if you have time at hand, make an effort to start saving for retirement today and if needed, choose the right financial advisor in helping you see where you stand in your current retirement planning.

Conclusion

The first step to saving for your retirement is to recognise the need to put money away specifically for your long-term cause. With a precise retirement amount in mind, you will be able to find new ways to increase your contributions towards it.

When you work with your financial professional, they’ll help you decide correct asset allocation in stocks, mutual funds, cash equivalents, bonds, tangible assets and more. The right financial advisor will help you understand various combinations that can work for you, based on your threshold for risk and potential returns you need to meet your retirement goals.

Disclaimer : ICICI Securities Ltd.( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai - 400020, India, Tel No : 022 - 2288 2460, 022 - 2288 2470. AMFI Regn. No.: ARN-0845. We are distributors for Mutual funds. Mutual Fund Investments are subject to market risks, read all scheme related documents carefully. The contents herein above shall not be considered as an invitation or persuasion to trade or invest.  I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents herein mentioned are solely for informational and educational purpose.

Most Popular

  • 21 Jun 2022
  • ICICI Securities

Should you invest in Mutual Funds SIPs or FDs?

Choosing between a Systematic Investment Plan and a Fixed Deposit comes down to risk appetite and investment goal. Nevertheless, mutual fund SIP investments can be beneficial in many ways. This article will outline the difference between the two investment instruments and which one you should choose.

  • 21 Jun 2022
  • ICICI Securities

How to choose the best SIP investment?

Systematic Investment Plans (SIPs) are an option to make regular investments in mutual funds. Before heading to make an investment in SIP mutual funds, consider these factors to find the one that perfectly justifies your financial goals. 

  • 21 Jun 2022
  • ICICI Securities

How does long term capital gains tax impact you?

Certain assets, such as real estate and shares, attract long term capital gains (LTCG) tax. Here’s what you need to know about LTCG tax and how it can impact your finances.

  • 21 Jun 2022
  • ICICI Securities

Choosing between stock market and fixed deposit investments

Choosing the right investment option is critical for meeting personal financial goals. This article will highlight the difference between choosing stock market investments and fixed deposits—the aspects to consider, the risk-return profile, and what would fit into your portfolio.

  • 21 Jun 2022
  • ICICI Securities

Are Small-Cap funds good investments?

The best small-cap funds outperformed large-cap and mid-cap mutual funds last year. Now that the markets are turning bearish, is it a good idea to invest in small-cap mutual funds? Here’s an overview of these equity mutual funds to help you make an informed decision.

  • 17 Jun 2022
  • ICICI Securities

What Does the US Fed's Biggest Rate Hike Mean?

On 15th June 2022, the US Federal Reserve hiked interest rates by 75 basis points, the biggest hike since 1994. Why did it do so? What are its implications for India? Read on to find out more.

  • 15 Jun 2022
  • ICICI Securities

What is ESG investing and everything you need to know about it

In the last few years, since climate awareness and social justice have piqued people’s interest worldwide, ESG investment has increased. This article talks about ESG investing and the options available for ESG investment in India.

  • 15 Jun 2022
  • ICICI Securities

The Latest ESG Reporting and Framework in India

In May 2021, India introduced a new environment, social, and governance (ESG) guideline for the top 1,000 listed companies by market capitalisation. The Business Responsibility and Sustainability Report (BRSR) will be mandatory for these companies from FY 2022-23. Here’s what you should know about this ESG guideline.

  • 15 Jun 2022
  • ICICI Securities

Difference Between ESG and SRI Investing

When it comes to value investing, the two terms—ESG investing and SRI investing—are often confused. However, ESG investing strategies are different from SRI investing strategies. Read more to find out what sets the two apart and how you can decide which approach to adopt.

  • 14 Jun 2022
  • ICICI Securities

Four ways to ensure you leave your children a financial legacy

It is a moment of pride for parents to see their children earn their own money and lead a life with dignity. No words can express the joy to see your children grow, but how do you touch their life when you are gone? You can do that by leaving behind a financial legacy for your children to inherit. Here are four ways you can align your financial plan such that you leave behind something for your children.