Jul 2022
4 mins read

5 Ways to Track Your Finances Post-Retirement

Most people want a relaxed life after retirement, which is well-deserved – but it’s important to keep an eye on your financial and investment planning even as you kick back. Since your monthly pay cheque may cease once you retire, a detailed retirement plan can help organise your personal finances for the long run. You will have to analyse your expenses, plan your income around your goals and systematically allocate money to the activities and projects you want to take up in retirement. While saving money is crucial, getting insured and investing money in the right place are equally important.

Sort out your income

Evaluate your financial situation and identify the income you’ll need to fund your lifestyle after retirement. There are several income sources available post-retirement, including pensions, alternative careers, freelancing or consulting income, savings, income from investment returns, etc. It’s also important to calculate the after-tax benefits you expect from each of these sources. 

point 1

Identify how much you need to spend

Your spending needs may be higher than they were before retirement. This is also because there may be new health issues or other emergency expenses that crop up. It’s important to observe your situation and identify your spending needs exactly. Categorising them into long-term and short-term spends may make it easier to plan your retirement budget accordingly. 

point 2

Keep track of expenses and avoid unnecessary spending

Try to maintain an income and expenditure sheet. You can then flag avoidable expenses and plan your post-retirement life better to minimise them. This might preclude expensive habits like impulse shopping. By controlling your expenses, you can ensure you have enough funds to manage your household or handle emergency expenses. 

point 3

Mitigate your taxes

No one wants their savings to be drained by taxes, so planning your tax components efficiently is vital. You can opt for tax-saving schemes but try to avoid ones that offer low returns and have long lock-in periods. 

point 4

Keep monitoring your retirement assets and investments

It’s always a good idea to conduct regular reviews of your assets and investment portfolio. For example, calculating your portfolio withdrawal rate may help determine whether you’ll have enough funds to meet your post-retirement expenses. In case you don’t have enough, you can explore new personal finance investment options. This is also a good time to review your investment allocation, assessing whether you have the right balance of debt and equity fund investments and whether your returns are as expected. 

point 5
Effective financial management can help you make the most of your retirement. Seek the help of a professional advisor to help you manage your finances, and enjoy your new life with complete peace of mind.
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