7 Major Expenses to Plan for in your 50s
Funding your child’s higher education
If your child is headed to university, remember that education inflation has grown at twice the rate of household inflation2 . Consider mutual fund investment through SIP or any other form of investment that offers inflation-beating return potential, to build a corpus big enough for this expenditure.
Organising your child’s wedding
The big fat Indian wedding can cost lakhs, even crores, of rupees, so planning ahead for this major life event is crucial. Build up a dedicated corpus so that you don’t have to dip into your savings to fund your child’s wedding.
Don’t make the cardinal mistake of taking your debts into retirement. Your 50s are the right time to pay off all your debts or at least scale them down, so that you enter retirement debt-free.
Managing healthcare costs
Healthcare expenses can rise exponentially after 503, and out-of-pocket expenditure on a medical emergency can drain your savings. Try to adopt a healthier lifestyle and invest in an adequate health insurance policy to protect your savings from unexpected expenses.
Getting life insurance
If you have not yet purchased a life insurance policy, your 50s might be the last chance to do so. Life cover provides financial protection to your family in the event of your untimely demise, and knowing they’ll always be secure will allow you to live stress-free. You can also look for retirement plans that come with a built-in life cover.
Building a retirement corpus
In your 50s, you must ensure your savings are substantial enough to last a lifetime. SIP investment in a mutual fund can be an excellent way to steadily contribute a portion of your income towards your retirement corpus.
Planning a hobby or entrepreneurial venture
Retirement is an excellent opportunity to take up a hobby or pursue your entrepreneurial ambition. Start preparing now for the things you would like to do post-retirement, so that you’ll have adequate financial resources for them.
Remember, your income grows by the time you hit your 50s, but your expenses also mount. Prudent financial decisions today can set you up for a secure retired life – so make the most of this opportunity.
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