Many of us fail to set aside dedicated savings for retirement expenses. Consider this—if someone starts working at 25, they typically remain employed for around 35 years until they reach 60.
After that, they may spend the next 15 years, from 60 to 75, without any active income, relying solely on savings. But how many actually plan for this phase? We often see retirees struggling financially, lacking sufficient funds to sustain themselves.
In many households, elderly individuals are left with no choice but to depend on their children for even basic expenses. Shouldn’t retirement be a time of security rather than financial stress?
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Investing for Retirement Needs!
To avoid financial struggles during retirement, it is essential to start investing specifically for that phase.
However, many delay this until after their children’s higher education and marriage, leaving them with little time to accumulate the necessary funds. As a result, they are forced to save large sums in their 50s and 55s.
For instance, even if someone invests in a mutual fund linked to the stock market, averaging a 12% annual return over the long term, they would need to contribute ₹43,050 per month for 10 years.
If the investment period is reduced to 8 or 5 years, the required monthly investment jumps to ₹61,910 or even ₹1,21,230. How many people can realistically afford such high contributions at that stage?
Wouldn’t it be wiser to start early and invest smaller amounts over a longer period?
Time is Money!
Therefore, Investing for retirement at a young age is crucial. Ideally, one should begin as soon as they start earning. The longer you stay invested, the greater your financial rewards.
Let’s consider an example.
Jagannath and Dinesh, Two friends of the same age, joined a company together at the same salary. The moment Jagannath started working, he began investing ₹5,000 per month in a stock market-linked mutual fund for his retirement.
In the initial years, this investment was a stretch given his entry-level salary. However, as his income gradually increased, this monthly contribution no longer felt like a burden.
Dinesh, on the other hand, indulged in discretionary expenses—smartphones, a car, and more—before finally starting to save for retirement at the age of 35.
To make up for lost time, he invested three times what Jagannath did—₹15,000 per month.
Now, assuming both investments yielded an average annual return of 12%, who do you think accumulated more wealth by the time they turned 60?
By consistently investing ₹5,000 per month for 35 years, Jagannath’s total investment of ₹21 lakh would have grown to ₹2.72 crore.
Meanwhile, despite investing a higher amount—₹15,000 per month—for 25 years, Dinesh’s total investment of ₹45 lakh would have grown to ₹2.52 crore.
The numbers speak for themselves. Starting early, even with a smaller amount, can be far more powerful than investing a larger sum later. Would you rather have time on your side or play catch-up later?
| Details (Assuming an Annual Return of 12%) | Jagannath | Dinesh |
|---|---|---|
| Age at Which Investment Begins | 25 | 35 |
| Monthly Investment | ₹5,000 | ₹15,000 |
| Total Investment Duration | 35 years | 25 years |
| Total Amount Invested | ₹21 lakh | ₹45 lakh |
| Final Corpus at Age 60 | ₹2.72 crore | ₹2.52 crore |
The Power of Early Saving!
Why did Jagannath accumulate more wealth despite investing a smaller amount? Time.
Even with lower monthly contributions, his longer investment duration gave his wealth the advantage of compounding, leading to a significantly larger corpus “The sooner you invest, the greater your financial peace in retirement.”.
Think of it like farming—trees take time to grow and bear abundant fruit. Similarly, investments need time to generate higher returns.
The longer you stay invested, the greater your financial rewards.
So, why delay your financial goals? Start investing today!
Yes… Time is Money!
Final Takeaway
Secure Your Future—Start Now!
The sooner you invest, the greater your financial peace in retirement. Don’t wait until it’s too late—let time and compounding work in your favor. Start today, stay consistent, and enjoy a worry-free retirement!
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