We PLAN to RETIRE at the AGE of 40 !!!!!!

Zindagi Na Milegi Dobara, had Hrithik Roshan saying, “ 40 KI AGE PE RETIREMENT AUR PHIR ENJOYMENT”. 

But are we Ready for this………??????

With a young population, attractive entry level salaries the likes of which were beyond the imagination of their parents, the segment of young earners has a very high DISPOSABLE INCOME. Even though they are well paid, they are often insecure, debt ridden and confused as the priorities of a young earner are way different from those of someone who has been earning for a few years.

However, the fact remains that almost all their major long term goals can be met if young earners follow a disciplined approach towards financial planning. 

Some common pitfalls which this Generation faces :

1.      Balance between budget and life  -  The easy route that most of the young earners take is to worry about finances and security later, but eventually any overspending or lack of provision will catch up with them.

2.      Payback now and save later  -  Many young earners at the earlier stage of their career are burdened with student loans. And that is the biggest load on their mind.

3.       Savings & Cash Safety Net  -  Many people in their twenties feel they do not have enough money to live on, let alone set aside for a nest egg. At least save enough money to cover three months worth of their monthly costs. This is not an investment but rather a safety net to protect them against unforeseen events and expenses.

4.      Encourage to invest aggressively - Invest as aggressively as you can stomach. For younger people, their biggest asset is their potential income stream and their capacity to bear risk is very high. If they are in their 20s they could easily be 100 per cent in stocks or equity and afford to lose 40 per cent and still make it up in their lifetime.

5.      Plan for Retirement – This Generation starts planning for Retirement, the Day one gets the OFFER LETTER. Planning is good but EXECUTION of which is lacking in most of the cases.

Remember, the days, when we used to get POCKET MONEY from our Parents, this helped us to manage that money in the best possible manner for a certain duration, not that one was denied further allowance but this helped us MANAGING FINANCES better.

Similarly, if  WE issues are addressed by devoting proper time and research, then definitely retirement at an early age is possible, and more importantly then we can vouch for Hrithik’s opinion in the film saying “ AGAR BANK MEIN Rs. 40,000 Crore ho, to ENTERTAINMENT ke liye BIWI ki kya ZAROORAT HAI”

So don’t just start PLANNING today, EXECUTION is more important........

The Article is a contrast to the one published in Economic Times dated 08^th September, 2011