Retirement

Planning
Planning today for a happy tomorrow

 AGENDA
Introduction Benifits

Factors to consider Retiement budget

Types of retirement plan Pension

4% rule of withdrawl Biblography

 Acknowledgement

Apart from the efforts of me, the success of any project depends
largely on the encouragement and guidelines of many others. I take
this opportunity to express my gratitude to the people who have
been instrumental in the successful completion of this project

I would like to show my greatest appreciation to Prof. kanika arora. I

can't say thank you enough for his tremendous support and help.
Without her encouragement and guidance this project would not
have matenalized

The guidance and support received from all the members who
contributed and who are contributing to this project, was vital for the
success of the project I am grateful for their constant support and
help
The Picture of the Perfect Retirement

1 Travel and see the world.

2 Be happy and comfortable every day.

3 To be emergency ready

4 To maintain standard of living

5 Live independently with love and purpose.

WHAT IS RETIREMENT PLANNING?

Retirement planning is the process of saving

and investing money before retirement in
order to ensure a source of income after
retirement.

Most often this is done using financial vehicles

designed specifically for this purpose, such as
an IRA or 401(k)
 These retirement vehicles consist of a suite of
investments, which may be stocks, or something
else.
The funds placed into the account are invested and
grow over the course of the account holder’s life.
Usually the accounts do not allow the account
holder to access the funds until a prerequisite age.
Once the account holder reaches that age, the
accumulated funds are distributed back to them.
This can be in several payments or a lump sum.

 BENIFITS

Regular income Guaranteed lifelong Safe and secure investment

after retirement income without market volatility

.
 BENIFITS

Customisable as Tax benefits on

per your needs investments

 How much To have a comfortable, secure—and fun—

to save retirement, you need to build the financial
cushion that will fund it all

Your current age and expected

Time retirement age create the initial
Horizon groundwork for an effective retirement
FACTORS TO CONSIDER

strategy.
FOR RETIREMENT
Having realistic expectations
PLANNING Retirement about post-retirement spending
Spending Needs habits.one must should not have

unrealistic expectation

the actual rate of return must be

calculated on an after-tax
After tax
return basis.Depending on the type of
retirement account that you hold,
investment returns are typically
taxed
HOW TO CREATE RETIREMENT BUDGET

1. Start with an estimate of the

income you will need.
2. List your expected
spending.
3. Consider expenses that will
change in retirement.
4. Estimate your retirement
income.
5. Set up a spending plan you
can track and adjust.
6. Try out your budget.
 HOW TO CALCULATE RETIREMENT CORPUS

Mr. Sunil is currently 35 years old and planning to retire at the age of 60. His
current monthly expenses are Rs. 35000. Expected return on investment is 8%
post retirement. Average inflation is assumed to be 6%. Life expectancy is
assumed to be 80 years.

Current monthly expense (Rs) PV 35000

Expected annual inflation

i 6%
during accumulation phase

Number of years to retire n 25

Monthly expense at the time of

retirement
FV = 35,000 (1+0.06)^25 Rs 1,50,215.5
 HOW TO CALCULATE RETIREMENT CORPUS

Life expectancy after retirement (in

years) N 20

Expected rate of return post retirement

r 8%

Expected annual inflation post

retirement i 6%

Annual expense at the time of retirement P=FV*12 Rs 18,02,586

Corpus needed C=P*((1-((1+i)/(1+R))^N)/(R-i)) Rs 3,00,48,832

ANNUITY
DEBT PLANS
PLANS

TYPES OF
IRA 401(K)
RETIREMENT
PLANS
SCSS PMVVY
 ANNUITY PLANS DEBT PLANS

Annuity plan this is another good Debt funds are mutual fund schemes
option available you can invest a which invest in fixed income generating
lump sum and received a monthly securities such as Commercial Papers
quarterly or yearly annuity so you (CP), Certificate of Deposit (CD),
have money coming in to take care Corporate Bonds, T-Bills, government
of your need they are different securities and other money market
type of annuity plan like fix annuity instruments.. These are the safer option
or variable annuity etc.It is a available as they are less risky
contract between you and an compared to equity these investment
insurance company that requires provide fix income that is why they
the insurer to make payments to carry less risk just before retirement
you, either immediately or in the you can shift your investment to debt
future fund to keep them safe
 IRA 401(K)
A 401(k) plan is a retirement savings
An individual retirement account (IRA) account sponsored by an employer.
allows you to save money for retirement in Employees can choose to have a portion
a tax-advantaged way. of their paycheck withheld and deposited
An IRA is an account set up at a financial into the account. The money in the
institution that allows an individual to save account can be invested in various ways,
for retirement with tax-free growth or on a including stocks, bonds, and mutual funds.
tax-deferred basis. The 3 main types of IRAs
It is a tax-deferral retirement savings
each have different advantages:
account, which means that the money you

contribute to the account is not subject to

TRADITIONAL IRA
taxes until it is withdrawn. This can

provide a significant tax advantage,

ROTH IRA
especially if the 401(k) plan is funded with

pre-tax dollars.
POLLOVER IRA

DIFFERENCE IN IRA V/S 401(K)

An IRA is a type of retirement account

that you open, fund, and invest on your
own, while a 401(k) is a retirement
account you open through your
employer.

Senior Citizen Saving Scheme Pradhan Mantri Vay Vandna Yojna

any senior citizen It is most suitable for senior citizens
As the name suggests,
of above 60 years can invest in this having lump sum corpus after
scheme upto Rs. 15 lacs and avail regular retirement. You can invest upto Rs. 15
pension. The pension amount is credited lacs in this scheme. The entry age for this
directly into the bank account of the scheme is 60 years.
senior citizen at the end of each The scheme is administered through LIC
quarter.Major benefit in investing with and backed by the government. Hence, it
SCSS is stability of interest rate. Once ensures steady, guaranteed stream of
you lock-in your fund at a particular pension once you invest lumpsum
interest rate, it remains constant during amount in this scheme.The assured rate
the entire term of the scheme. The of interest is 7.40% per annum for the
current interest offered in the scheme is financial year 2020-21. The interest rate
7.40% per annum. The scheme tenure is is reset in the beginning of every financial
of five years and can be extended for year.
further three years once it matures.
A pension is a fund into which a sum of money is
added during an employee's employment years
and from which payments are drawn to support
the person's retirement from work in the form of PENSION
periodic payments. A pension may be a "defined
benefit plan", where a fixed sum is paid regularly
to a person, or a "defined contribution plan",
under which a fixed sum is invested that then
becomes available at retirement age
 TYPES OF
PENSION
PLAN
Whole Life ULIP

Public Provident Fund

National Pension Scheme

Regular Retirement Product



New Age Retirement Regular

National Pension
Features Products (Whole Life Retirement Public Provident Fund
Scheme
ULIP) Product

100%

tax-free income on Retirement Yes No No No

for Life

No,

Yes, No,
withdraw up to No,
Flexibility withdraw up to 100% of partially withdraw up to
33% of Fund partially withdraw up to 50% of
to withdraw 100% Fund Value Fund Value anytime after 5 25% of Fund Value after
Value upon Fund Value
years 10 years
Retirement

No,

No,
Yes, withdraw up to Yes,
Tax-free withdraw up to 60% of
withdraw 100% of Fund 33% of Fund withdraw 100% of Fund Value
Fund Value withdraw Fund Value tax-free upon
Value tax-free Value tax-free tax-free
retirement
upon retirement


New Age Retirement Regular

National Pension
Features Products (Whole Life Retirement Public Provident Fund
Scheme
ULIP) Product

Flexibility
Yes No No No
to increase, decrease income

Choice

of multiple investment
Yes No Yes No
strategies to maximize the
growth of fund value

Sec

Tax Sec
Sec 80 CCD (1B) up to Sec
exemption on Amount 80 up to
80 up to 1.5 Lacs 50K & Sec 80 up to 80C up to 1.5 Lacs
Invested 1.5 Lacs
1.5 Lacs


Best Pension Plans in India 2022

Annual
Entry Vesting Policy Sum
Pension Plans Premium
Age Age Term Assured
Amount

Aditya Birla Sunlife 25 5

80
Empower years-70 years- 30 Rs.18,000 N/A
years
Pension Plan years years

Depends

85 on the Min-
Aegon Life Guaranteed 20
85 years coverage, age, Rs.1 lakh
Income years-55
years minus entry term and Max- No upper
Advantage Plan years
age premium limit
payment tenure

Limited
42
13,16

Aviva Next Innings pay- Rs.50,000

years-60 N/A 0r 18 N/A
Pension Plan Single pay-
years years
Rs.1.5 lakh
What Is The 4% Rule For Retirement Withdrawals?

Following this simple formula, Bengen found that most retirement portfolios would last at
least 30 years. In many cases the portfolios remained intact for 50 years or more.
The 4% rule is easy to follow. In the first year of retirement, you can withdraw up to 4% of
your portfolio’s value. If you have 1 million saved for retirement, for example, you could
spend 40,000 in the first year of retirement following the 4% rule.
Beginning in year two of retirement, you adjust this amount by the rate of inflation. If
inflation were 2%, for example, you could withdraw 40,800 (40,000 x 1.02). In the rare case
where prices went down by say 2%, you would withdraw less than the previous year—
39,200 in our example (40,000 x 0.98). In year three, you’d take the prior year’s allowed
withdrawal, and then adjust that amount for inflation.
One common misconception is that the 4% rule dictates that retirees withdraw 4% of their
portfolio’s value each year during retirement. The 4% applies only in year one of
retirement. After that inflation dictates the amount withdrawn. The goal is to maintain the
purchasing power of the 4% withdrawn in the first year of retirement.
 CONCLUSION

Though people may think that retirement is

not something to think about when you have
just started working but I am sure that after
looking at all the benefits you are having a
second thought.well you should! Because you
have to face the fact that you can't work all
your life you are going to reach the retirement
says one day or the other So one should plan
well and live a happy retired life
Resource
Page
www.fedility.com
www.financestratergy.com
www.investopidia.com
www.forbes.com
www.policybazar.com
www.moneycontrol.com
www.cnbc.com
www.kotaklife.com
HAPPY RETIREMENT
IS NOT A DREAM!