If I ask you how do you plan or invest your money for retirement ?

And what amount you have planned  for yourself ?


So, the first answer would be the provident fund and the other would hardly get the answer.


We discuss about our retirement but do not try to know how much corpus will be required at the time of retirement. And this is the reason that we do not get enough money as much as we need for our retirement

And behind this there can be only two reasons, we know but still we are unaware

  • Inflation
  • Investment in non-equity product

Imagine you had Rs. 7 in 2003. You could’ve purchased a 300 ml Pepsi from the store and gone home happy (excluding the Rs. 2 that shopkeepers charge for refrigerating it).

Fast forward 10 years and you would have to shell out R. 12 to purchase the same 300ml Pepsi bottle. What happened?

You would think Indra Nooyi has fleeced you but in reality, the value of money has reduced. This is attributable to inflation.


||Inflation is defined as a sustained increase in the general level of prices for goods and services||


This proves one thing that we should consider inflation in our retirement fund.

The second aspect is that if we collect our money for the retirement fund, then most of us talk about a long-term planning

If we know that we can invest money for a longer period then why not do it in equity

Why am I talking about equity?

You just need to know that if you had invested 113.28 Rs. in the Sensex in 1979, then today it will be valued at 31596 on August 24

So, the simple thing is that if your Goal is a long-term goal, which is meant for retirement, then for the longer term in returns no one can beat the equity

In equity, then we can have two options – Direct Equity or we can go to Managed Equity ie mutual funds

Those people who do not know probably, try to explain them in simple language

“A mutual fund collects money from investors and invests the money on their behalf. It charges a small fee for managing the money’’

How to invest in mutual funds?

You can either invest directly with a mutual fund or hire the services of a mutual fund advisor. If you are investing directly, you will invest in the direct plan of a mutual fund scheme. If you are investing through an advisor or intermediary, you will invest in the regular plan of the scheme.

If you want to invest directly, you will have to visit the website of the mutual fund or its authorized branches with relevant documents. The advantage of investing in a direct plan is that you save on the commission and the money invested would add sizable returns over a long period


Now the most important thing is that you must know how much money you need for retirement.

whatever amount you want to collect, it must be conceded that the value of that money will be reduced due to inflation.

In your financial planning, inflation will have to be taken in calculation. If you are getting 12% return per year in a financial product and inflation is 5% then your money is rising only by 7%.

And 12% return is not possible in fixed deposit or ppf but still if you invest your money in fixed type of instrument because of safety so, you will be able to appreciate your money by only 3% (8%-5%, if fixed deposit giving 8% return)


In the last we can say that if you are planning for retirement then you must participate in equity so that you can create the corpus for that goal (retirement) and mutual fund can be a good solution to accomplish this goal

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