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    What is Retirement and the Benefits of Planning Early Retirement?

    Last Updated On 04-04-2022

    When your career is at its peak, financial planning for retirement might not cross your mind. After all, you are in the pink of health, your career is going upward, and everything is well in general. But as soon as you are in your late 40s, the fact of your retirement years looming ahead becomes inevitable. But by that time, if you don’t have savings or investments or you haven’t planned for retirement at all, you might have to continue working for more years than you think. To avoid any such hassle and get the retired life you deserve, it is best to start early retirement planning. Read on to find out why.

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    What is financial planning for retirement?

    Financial planning for retirement is planning, saving, and investing for your golden years. It involves starting with a rough outlay of what you want your retired days to look like and ends with finding ways to create the wealth you need to support that life. Without proper retirement planning, you run the risk of becoming financially dependent and not having enough to fuel your dreams. You might even have to compromise on your needs and continue to keep working to make ends meet. To build a financial reserve for your post-work-life needs, it is crucial to start early retirement planning.

    What are the benefits of early retirement planning?

    • Better returns
      One of the biggest benefits of early retirement planning is the quality and quantity of returns you get. Most retirement planning is successful because of on-time saving and investing into retirement savings plans or instruments. Both saving and investing work on the principle of compounding. Compounding is when the value of something, in this case – money, multiplies over time. The longer you save and stay invested in retirement planning, the higher returns you reap. Even if your initial investment is small, but you start early, you end up reaping more than someone whose initial investment is more but starts late.
    • Emergency readiness
      Early retirement planning helps you stay prepared in the face of an emergency. Most of the time, as you get older, the chances of developing a disease or needing quality healthcare becomes higher. As you are less likely to even qualify for health insurance at an older age, you can rest assured your retirement savings plan has your back. With early retirement planning and execution, you ensure you have sufficient finances to tackle any emotional, physical, or mental challenges life throws your way. Moreover, as healthcare prices are on a perpetual soar, it is wise to amass maximum earnings and have financial stability.
    • Financial independence
      Financial planning for retirement ensures you retain your financial independence and own every phase of your life, including your second innings. It gives you the reign and the control over navigating your dreams, desires, and hopes for the latter half of your life. You will not have to compromise on your needs or your standard of living with the wealth you amass with financial planning for retirement. Proper retirement savings plans and other retirement investments give you regular income to fund your retired life. Moreover, they negate the effects of inflation and become a substitute for your primary source of income.
    • Tax benefits
      Investing in retirement savings plans or any other type of retirement plan gives considerable tax benefits under the provisions of the Income Tax Act, 1961. Under section 80C of the Act, the premiums paid towards the purchase of a retirement savings plan are claimable as returns. You can claim up to Rs. 1.5 lakh from the total premiums paid in a year as this amount is exempt from tax deductions. Moreover, even the returns or maturity payout you get under the retirement savings plan are exempt from tax deductions under section 10(10)D of the Act. These tax benefits will help you save a lot in the long run.

    What can be called some of the best retirement plans?

    • Immediate/ Deferred Annuity plan
      Annuity retirement plans become the primary source of financial support after you retire from your work life. With immediate or deferred annuity plans, you get regular and consistent income for yourself and your spouse. You receive this income after the payment of premiums. In an immediate annuity, once you pay the premium, you immediately start to receive the retirement income.
      In a deferred annuity, you start receiving it after some time. The periodic nature of payouts in both types of retirement plans makes it easy to manage your money, and you can consider it as one of the best retirement plans. You can also leave a legacy for your dependents as these plans return the purchase price after the end of their tenure.
    • Guaranteed Savings Plan
      A guaranteed savings plan gives you the dual benefits of life insurance protection and wealth creation through disciplined and systematic long-term savings. This is a low-risk retirement savings plan as it is not influenced by market fluctuations and yet, gives better guaranteed returns when compared to all traditional savings instruments such as fixed deposits, etc.
      To understand how you can plan an early retirement with a guaranteed savings plan, it is always wise to plan early and use an online retirement calculator. This helps you get a close estimate on how you can utilise your savings plan, and thus, you can secure your retirement needs.
      Moreover, these plans also provide life insurance protection, which means your family will receive financial support in your absence.

    To sum it up:

    Early retirement planning helps you unlock the power of compounding and works best against negating inflation. It gives you the maximum scope of returns that are necessary to serve your retired life. To know more about  term planterm insurance and long term savings visit PNB MetLife website.

    Doesn’t the thought of retirement sound blissful? No work, no deadlines, and all your hours spent doing the things you love, like travel, painting, and even napping in the afternoon! If you want your retirement to be what you have always dreamed of, start retirement planning now and save a considerable retirement corpus in time. The online Retirement Calculator can help you plan your future financial goals and ensure you achieve them within the stipulated time. 

     Disclaimer:

    The aforesaid article presents the view of an independent writer who is an expert on financial and insurance matters. PNB MetLife India Insurance Co. Ltd. doesn’t influence or support views of the writer of the article in any way. The article is informative in nature and PNB MetLife and/ or the writer of the article shall not be responsible for any direct/ indirect loss or liability or medical complications incurred by the reader for taking any decisions based on the contents and information given in article. Please consult your financial advisor/ insurance advisor/ health advisor before making any decision.

    PNB MetLife India Insurance Company Limited
    Registered office address: Unit No. 701, 702 & 703, 7th Floor, West Wing, Raheja Towers, 26/27 M G Road, Bangalore -560001, Karnataka
    IRDAI Registration number 117 | CIN U66010KA2001PLC028883
    For more details on risk factors, please read the sales brochure and the terms and conditions of the policy, carefully before concluding the sale.
    Tax benefits are as per the Income Tax Act, 1961, & are subject to amendments made thereto from time to time. Please consult your tax consultant for more details.
    Goods and Services Tax (GST) shall be levied as per prevailing tax laws which are subject to change from time to time.
    The marks "PNB" and "MetLife" are registered trademarks of Punjab National Bank and Metropolitan Life Insurance Company, respectively. PNB MetLife India Insurance Company Limited is a licensed user of these marks.
    Call us Toll-free at 1-800-425-6969, Phone: 080-66006969, Website: www.pnbmetlife.com, Email: indiaservice@pnbmetlife.co.in or Write to us: 1st Floor, Techniplex -1, Techniplex Complex, Off Veer Savarkar Flyover, Goregaon (West), Mumbai – 400062, Maharashtra. Phone: +91-22-41790000, Fax: +91-22-41790203.

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    Disclaimer

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    As your trusted life insurance partner, PNB MetLife is with you amidst the current COVID-19 outbreak. Our policies also cover COVID-19 Claims. In case of a Death Claim, kindly submit the signed Claim Intimation Letter mentioning the policy number, brief of the insured event and other claim documents on the email mentioned herewith. Please write-in to us at claimshelpdesk@pnbmetlife.com or indiaservice@pnbmetlife.co.in. You can also call us on 1800-425-6969 for death claims intimations and for any queries on Monday - Saturday between 10:00 am - 7:00 pm.

    PNB MetLife Insurance, amongst the trusted Life Insurance companies in India, aims to provide a wide range of Life Insurance products that suits the needs of an individual at every stage of his life. Life Insurance Plans range from Term Life Insurance PlansTerm PlanProtection PlansLong Term Savings Plans , Retirement Plans & Child Education Plan.

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