When to Start with a Pension Plan?

by Vinaya HS on February 16, 2015

in Finance

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Planning your future is extremely essential to lead a successful life. The rate of every commodity is rising with the changing times. You do not know what the rates would be after certain years! For now, you have a stable job to survive the ever increasing inflation. But, how will you manage your finances after you retire?

This is a big question that everyone should ponder upon. The answer to this certainly lies in having a good pension plan. But, when should you start thinking about the plan? When is the right age to invest in a pension plan?

The answer is, now. Start your pension plan immediately on getting your first job. The younger generation fails to understand this. They think, they have many years left for retirement and pension plan is something that they should think about at a later stage. But the fact is the early you start, more benefits you get.

Starting early means you will be invested for a long time. Long term investments always fetch better results as your money gets a longer period to grow. Pension plans being a long term plans, will also give you better outcomes if you start early.

When you start early, you can accumulate a lot of corpus to bear all the expenses of your retirement life. Besides, you can manage to collect a large amount with little savings. This also helps to inculcate the habit of saving from a young age. On the contrary, when you start your pension plan late, you need to increase your savings considerably and your returns are also comparatively low.

If you haven’t invested in a pension plan yet, then start with one immediately. People belonging to different age groups should see different aspects when looking for a pension plan. Some of the things you should see, before selecting the plan are:

  • When you are in Mid 30s: At this age, you should take an estimate of how much money you will require, after you retire. You should also check whether the scheme is sufficient or you need to save more to cope with the inflation? Accordingly, choose the best pension plan. You may invest more, if required.
  • When you are in Mid 40s: In your 40s, you become mature enough to understand the realities. At this age, you have a clear picture of where you will settle, when you will retire and how much fund you will require to fulfill your desires in the post-retirement life. These things will help you to know how much to invest in which scheme.
  • When you are in Mid 50s: This stage leads you closer to the retirement age. It is high time when you get serious about your retirement life. Go through various pension plans in India and pick the right one. You should pick that plan which will take care of your health and medical expenses along with funding your dreams.

It is certain that early planning makes your life after retirement, financially comfortable and secure. So start planning now and choose the best pension plan in India for yourself.

About HDFC Life

HDFC Life, one of India’s leading private life insurance companies promoted by HDFC Ltd. & Standard Life Ltd., offers a range of individual and group insurance solutions. HDFC Life’s product portfolio comprises solutions, which meet various customer needs such as Protection, Pension, Savings, Investment and Health.

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