Retirement - A boring but important financial decision / Rewire /Sunset years/Second Inning - MOST important

Happy Saturday,

Yesterday I wrote about SIP in equity mutual fund and power of compounding , I hope you have read it to realize the value .

Today I  will talk about the subject which looks very boring , far fetched and less interesting for a person who is in his/her age group of 20-40 , but for those people who already attained the age group of 45-55 and done nothing concrete to fund their sunset years , which is about to begin in next 5-15 years of time , that will bring stress of not planning properly during their early income years or got hooked with poor investing habits that generated income for those who does not care about your financial well being , an the time flies away and you realized you made a big mistake that can not be revoked , In reality a person can retire or take holiday from work forever if he foresee the future of his LIFE , Ideally if someone start investing on the very first day of job and that too systematically through SIP route in Diversified Equity mutual fund schemes to fund the second inning, One can retire from work early , let say 40 or 45 years of age , a dedicated investment of 10-15 years in equity mutual funds is more than sufficient to fund your retirement life ,  Consumer price inflation eats away your purchasing power and reduce wealth creation process , India has a consistent CPI since last many decades at the rate of 6%-8% means your 100 rs will become price less and value less in 40 years as after first 10 years 100 will become 50 , next 10 years value of 100 rs will decrease by 1/4th and becomes 25 and in next 30 years 100 will degrow by 1/8th of todays value to become 12 , its an invisible enemy to wealth creation , So before planning retirement fund planning , consider the CPI rate , If any investment under the Sun does not beat Inflation at first place , it is useless to look at such investment option , Current FD rates in FY 2021 are in range of 2.5-4.5 % , Post office Schemes generates some where around 5%-7% of  Return , 80% of funds are parked in these two institution named as Banks and Post office that degrowing investment value on year on year basis and not even beating inflation to protect the value of money , thanks to inefficient allocation of funds by our Citizen of India , So what is the solution Ahead , The only solution to the problem is an investment tool that invests into equity related options and that is Direct equity and Indirect equity via mutual fund route .

Here I am not getting into Gold or Real Estate as these are Physical assets , once bought Gold by someone , no one sells to fund retirement years and Real Estate investment is a very Suicidal approach.

''I will blog over Gold and Real Estate Separately''  

Equity is nothing but a share, a business , an investment option , that has all qualities of good investment , a diversified tax saving ELSS mutual fund scheme has generated more than 10%-12% of CAGR return in last 20+ years of its launching and created enormous wealth to fund your Retirement years , 

During retirement years you will need a constant positive regular cash inflow to fund your Lifestyle expenses and that is only possible if you invest in equity related investment options like mutual funds ,  

Praveen Kumar Verma
AMFI registered mutual fund distributor 
www.mfdpkverma.com
9565908070
info@mfdpkverma.com

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