dear viewers welcome to this episode of your life your money today's is a very important video for the age group 50 to 60 you are staring at starting your retirement in the next decade this is the time you have to focus on 12 points that I'm speaking in this particular video to create a very safe and good retired life this is NRI money clinic for you and I'm Dr Chandra Khan your financial guide for a happy [Music] living NRI money Clinic no hype just the right advice let us look at these 12 points little bit
more in detail if you are at age 50 and between 60 years the step one to do is take stock of your situation what have you done till now are your savings adequate where you have pked your money where is your real estate what is working for you what is not working for you what is your job situation are you okay to retire at 60 years of age do you have to extend your work life beyond that particular point is your job safe have you finished with your children's unfinished responsibility have you provided for all
these things everything that has happened in your life you should put it on a pen and paper take stock of the situation and focus on what is that you need to do Beyond this particular point this gives you a starting point to work Beyond this point number two simplify by age 50 make no mistake stake whether you are a do it to yourself investor or you have worked with somebody else or you have done a lot of things it is fair to expect your life is filled with lot of complexities complexities in your assets complexities
in the things that you have done and you have done a lot of things you would have scattered a lot you have forgotten you could have parked your money in different institutions there could be very complex situation which has developed in your life this is a time you have to simplify this is a time you should identify what is working in favor of you what is that makes you forgetful of these small small investment that you have done you could have done 5 10 insurance policies you could have parked your money in different banks you
could have had plots of land you could have purchased real estate if you are an NRA you could have invested overseas time now to simplify consolidate get rid of things that you don't need and focus on only those things which need which are limited in nature which you can easily remember number which are sizable which will be useful simplification is the order of the day point number three list your future needs individual needs could change you are no more an aspirational generation person you are staring at retirement it's not a time where you are looking
to buy that expensive Gadget or expensive watch or something like that your needs could be more defined it could be providing for the higher education of your children it could be a need of buying a proper retirement house it could be the need of building your retirement Corpus Define all your future needs if you had a some kind of liability still now it could be a home loan it could be a personal loan it could be any liability that you have on you this will become your future needs find out what are your future needs
how much money is required and then let us see how it can be met so you have to list all these things that are required for you in the future that gives you a start starting point for you to start working how you can meet these needs Point number four engage a financial planner I stress this word at this stage you must engage a financial planner whether you are a do- it yourself investor somebody who has done things on your own or somebody who has not done anything somebody who has done random things this is
a time you must engage a financial planner you cannot avoid a planner at this stage the life beyond this point you do not have an experience of how it will pan out what are the your risk what might happen to check your preparedness many people think having a lots of money will solve all the problems it will not there are lot of things which will happen in future in your runup to your retirement and post retirement it is requires the attention of a financial planner financial planners will help you to simplify financial planners will help
you to optimize on the tax side financial planners will be able to give the Judgment of Future How It Might pan out they may also draw your attention to the risk which will be unfolding in future and they can put in strategies to mitigate those risk see for example you have the reinvestment risk you have the risk of inflation you have the risk of Health there are multiple things the risk of loss of purchase power of the cash flows that you have designed they may look very small but these are serious risk and you do
not have an experience of handling this you need the services of professional financial planners people who are experienced people who are aged people who are ethical people who have worked with lots of people in the retirement planning are the people you should look at at this stage if you are somebody who is looking out for Professional Services in this you can make best use of our services Services provided by NRI Clinic we have team of experts who understand retirement in many countries across the globe you can reach to us through a WhatsApp message on the
numbers given to you our number is there in the description box below we have also provided a link over there just click on the link it takes you to the WhatsApp send us that exploratory message and our team of experts are ever ready to help you point number five know the conflicting situation which develops in your life this is very very important you are between 50 to 60 you have multiple things to do here and it can give rise to conflict there are three things which can give rise to conflict number one Higher Education of
your children number two a house to live number three is your retirement planning you have that one source of income you have the one stream of income or the assets that you have but you have three major things to do and these will have a conflict of interest your wife could be telling or you could be Desiring that you have to leave in a big house and that requires a large amount of money you are aspirational to send your children to the best institutes and you don't care what happens to your retired life you will
commit a disproportionate amount of money for your children's higher education when you work on one make no mistake it will come in conflict with attaining the rest of the things that you need to do at this stage out of the three things higher education of your children a big house and retirement planning or the cash flow or building that retirement Corpus your priority should be must be building the retirement Corpus or building the retirement cash flow that should be your first priority unless you provide sufficient enough money for building this retirement Corpus do not not
attempt to do more things on higher education of your children or on the house front do not commit disproportionate amount of money I'm not telling that you should not send your children to higher education please do send it's your responsibility but you should explore other options like getting an educational loan asking childrens to complete the graduation and work there afterwards and let them earn the money and then they can go for higher education all possibilities exist likewise when you're buying a house don't go behind a large house see your affordability check whether it is your
need or whether it's a want if it is taking out a lot of your retirement Corpus to leave in that house remember a big house can become a burden on you it's a dead asset you need money to lead a good life during your retired life if it comes in Conflict probably it's a better idea that your financial advisers will advise you to go for a smaller house or commit lesser amount of money for the house and more money towards your ATT planning knows these three conflicts if you are attending to any one of them
handle them with the due care so that your retirement is not put into any difficulty Point number six check your preparedness to retire what do you mean by checking the preparedness to retire I will handle Only Money aspect here I'll not look into other things there are multiple videos there are countless videos we have done on this channel to talk about the risk mistakes and everything which will happen today I'll talk on this particular Point how much money you need the best way to look at is the rule of 4% if you have certain amount
of money which you have developed or you're going to develop and you take 4% as the sustainable withdrawal from that for example if you have a CR of rupe as the liquid assets you can take 4% of 1 CR which is about 4 lakh rupees as your retirement cash flow if you have got 3 cror then you can take 4% of 3 crores which is roughly about 12 lakhs perom or for 1 lakh rupe per month now when you are doing the preparations here what you have to look at is what are my financial assets
the financial assets could be your fixed deposit your Rd accounts it could be your mutual fund it could be your stock portfolio it could be your NPS account it could be a PMS account anything which is financial asset in nature can be considered pull all these assets and see how much money you have based on the current thinking for a middle class or an upper middle class family it is fair to say if you have a house of your own if you have no liabilities and if you have got sufficient enough health insurance a minimum
retirement Corpus that is required is 3 cror an ideal or desirable retirement Corpus would be about 6 cror so your attempt should be to at least reach a retirement Corpus of 3 cror do not include when you're calculating the retirement Corpus all the real estate passes that you have and the multiple houses that you have if you sell that real estate and convert them into a financial asset you can add that till the day you do not sell this and they remain as real estate do not considered as your financial assets your preparedness comes when
your financial assets are in excess of 3 crores but this is not a definitive number this is an indicative number depending on individual circumstances these numbers can be revised upwards as well it depends on your lifestyle what Strat of society you belong to what kind of expenses you have but if anyone has a retirement Corpus of Less Than 3 crores I will not hesitate to say they are not ready to retire now you could be at age 50 and you may be just having 1 CR arriving at this figure tells you how much is a
gap that you have to fill in you can also take into account under this financial assets something called the end of service benefit you could be 50 or 51 52 you would have accumulated let's say 70 lakhs in your ppf account or PF account or your employer gratuity that also you can take into account and figure out are you ready to retire are you on course or not or there are severe shortages if there are severe shortages you need to talk to your financial planners and they will come up with a strategy what you can
do about it how you can TI over the situation should you extend your work life or what other things can be done your financial planners are the best person to handle that situation don't try to do things on your own Point number seven your life insurance most people at this age may not require life insurance why I took up the topic of life insurance if you do not need this the answer is it is fair to say that everyone has life insurance policies by this age you would have bought the policies long back now your
financial situation could be better there are a lot of people who do one mistake with the life insurance policies here number one is that they think they don't need and they think that there is money and they close these insurance policies please do not not do the mistake of closing the insurance policies just because you have lots of money let your insurance policies continue till the maturity also check the insurance policies what you have bought do they have a critical illness cover which are built into it see many nris when they buy policies outside of
India they would have bought critical illness cover you are moving to the other end of the life now the chances of people succumbing to critical illness are higher As you move to the other end of the life now your B life insurance with an idea that it will help you if you were to be that unfortunate person who will suffer critical illness now do not come under anyone's influence do not look at a money angle and close these policies allow them to continue for those people who have lot of responsibilities lot of emis the unfortunate
on but I still need insurance at this stage how will I manage that need I will definitely suggest you you do buy a term insurance cover it is not going to be cheap it will be very expensive to buy life insurance so buy if you think it is absolutely essential don't buy as if that it's like a jewelry around your neck so buy it in such a way that your premiums will become lesser how to make your premiums lesser at this age simple buy only to the required extent number two buy it for a shorter
duration of time thereby your premiums will remain lesser so again I'm stressing here buy life insurance at this stage only if it is absolutely essential buite it for shorter term buite it for lesser value that should be your guiding principle Point number eight a house to leave during your retired life if you are between age 50 to 60 this is the time you should develop very clear ideas about where you are going to retire will you retire outside of India will you retire in India if you're retiring in India which place you're going to retire
during your work life you would have acquired properties you could have had a house many people buy house at very young age by the the time they retire these houses are very old houses you don't feel like going and staying in that if that is your case then it is time that you work on building your retirement home now keep a few things in your mind do not buy very big houses as you get older physically mentally you will become weak you find it very difficult to maintain these houses you will be a loner you
are an empty nester children would have moved out of the house by this time it's you and your wife you do not need a really big house do not waste resources on buying a big house instead buy a house in a good locality it's a safe place and it's a modern contemporary living with all the facilities hospitals around whatever that you are looking for maybe near to the places where your friends are living anything is fine think about it take your time and focus on that house do not overcommit extraordinary amounts of money disproportionate of
money to buy that retirement house it's a good idea to swap the old real estate swap the old old house and get hold of the monies that is there and you can reinvest into the new house when you do this it'll be contemporary it'll be new it cost you less to maintain and you will feel very happy that I am retiring in a brand new or literally a new house where you can go and leave there Point number nine your health insurance all these days your health insurance could have been given by your employer this
is the time you should buy your own health insurance if you are fit and F mind you have no problems of diabetes blood pressure arthritis liver issues kidney issues anything which is chronic in nature you can postpone buying health insurance up to probably 2 to 3 years before retirement but even in these cases I will tell you it is a slippery Road Beyond this insurance companies may not be interested to give you health insurance if they detect even something not very comfortable for them or they may give prolonged waiting periods of time so even if
you are fit and fine healthy my suggestion is at least you buy a top of health insurance plan a top of health insurance plan is something which will give you cover in case your bills are very high for example you buy a topup health insurance plan for 25 lakhs I'm assur and you say the first 5 lakh rupees I'm not going to cover only if my bills are in excess of 5 lakh rupees then the insurance company will take care of those bills it will help you because if there were to be major incidences like
cancer dialyses treat major accident which requires prolonged treatment in hospital you may not be able to foot that bill that can be very well taken care by the top of plans the basic amount which you have an affordability can be taken care by your employer insurance if you're are employed or 2 to 3 years before your retirement you can buy that gap insurance to bridge that gap between the top of health insurance and what you didn't have in the beginning itself so that can be taken care of work on your health insurance do do not
delay time to buy health insurance is now Point number 10 work on retirement cash flows I'm very careful to use this word here retirement cash flows I'm not using the word retirement Corpus I'm using the word retirement cash flow what is the difference between a retirement Corpus and a retirement cash flow retirement Corpus is you have a lumsum amount of money you have a CR of rup 2 CR 3 CR whatever the figure that is there in your life that's a retirement Corpus a retirement cash flow is how much of money you get month after
month when you retire and when the salary stop stop here for a while and think for yourself what is the comfort that you derive in your life financially the comfort from your life comes because you are getting a salary at the end of the month whether you are a top earner or a low earner or a mid income earner every month at the end of the month your bank account gets credited with that salary that gives you comfort when you retire this Comfort is taken out you will feel Fish Out of Water I have worked
with thousands of families across Globe I have worked with the richest of the Rich and I've worked with even the poor families one thing I have noticed is people will feel fish out of water when the salary stops coming into their bank account they may be sitting on millions of dollars but if that month after month credits are not coming into your bank account you will feel fish out of water to take out that money from your carpus it hurts you so it is very very essential that you should work on where this money is
going to come from that is not a decision you have to take when you retire and then I'll see what I can do to planning for that has to happen at this age if you are between 50 and 60 in fact it should have started at age 45 the planning but unfortunately now you are at 50 to 60 this is the last stage where you can think about building the plan how do you get that month on month should you buy an annuity plan should you buy a guaranteed return insurance plan should you think about
an S swp should you work on your rentals what are the different sources of income you should count on all these things have to be factored in and I'll tell you this is where your financial planner will be very very useful to you he will take into account all things do you have enough money do you have shortage of money how your cash flow is going to come from he can design a literally a foolproof cash flow strategy for you if you are working with a financial planner do not neglect do not push it to
tomorrow if you do not have a cash flow strategy built in your life for retirement time to act is not tomorrow time to act is that is today Point number 11 tax planning tax planning becomes very very important during your retired life the planning cannot start when you retired the planning has to start now see during your retired life you do not have an active income you will have a passive income if you are having a pensions pensions become taxable if you are having a Bank fds the interest from the fds will become taxable if
you have rentals the rent becomes taxable so there are lot of streams of income that you get will come under taxation anything that you save out of the taxation is something which gives you a higher return I always stress on this point with every person with whom I'm working with saved taxes is the easy way to increase your yield every aspect of tax planning has to be explored and factored in and have to be put into your strategies of retirement planning tax planning is a very important tool I do not think you can do it
on your own this is something you have to speak to your financial planner design things in such a way that you pay out lesser taxes if you cannot pay lesser taxes can you defer the taxes instead of paying it today I'll pay it into the future 5 years later 10 years later 20 years later how can you minimize your tax impact that will increase your retirement cash flow Point number 12 the most important factor all these days you have been working I'm not sure whether your wife is working or she is a homemaker there are
lots of families where the women are Homemakers you have to look at the situation of your wife I presume it's a male who is watching this video if it is a lady you should also consider what is your situation with respect to retirement planning there are few points that you have to keep in mind number one the age gap between you you and your spouse People of Our Generation or 15 20 years younger than me used to marry women of lower age usually the Gap used to be anywhere from 2 years to 4 years to
6 years and there are in many families even the age Gap could be 10 years younger now data suggest that women are going to live longer than men it is proven the age gap between man and woman is further accentuates this problem so if you have a spouse who is is much younger than you then you should consider her age and her situation in your planning as well 95% of the families women do not take adequate interest in the financial affairs of the family this is a big risk point if you were to Fed out
from the scene living behind your wife and she is not knowledge enough or she doesn't take enough care to handle her finances then what can happen is a disaster after you leave the world you have to keep the this factor in mind and when you design your retirement cash flows you have to make sure that in your absence she gets a defined amount of money and she will not come under any stress because of children because of siblings because of friends or anyone else and she may squander all the good works all the all the
assets that you have done because of wrong planning or the vultures around her you need to be talking to her about the dos and don'ts of what she should do and what she should not do in case if you were to be not there in her life sometime in distant future this is something you have to consciously tell your spouse write it down and tell her that in case if you were to be not there please look at these points and do not violate these things if you follow these 12 points at this age of
50 to 60 I can confidently say you will have a pretty good retired life you will have a very nice life beyond this point dear viewers hope the video that I have done today helped you to understand the areas to focus if you are between the age of 50 60 if it did give you the right direction please do not forget to give me a thumbs up do subscribe to this channel press the Bell icon you will be notified whenever we release a new video thank you very much for watching this episode on nrm Clinic
I shall be back with you with yet another episode of your life your money next Friday till then stay safe J press the Bell icon for more details and subscribe our Channel [Music]
