When you have multiple financial responsibilities to manage, you prefer not to start retirement planning at this point. However, you fail to realise that this is also a financial goal to focus on. Besides, saving uniformly for retirement might not work.

There are factors like inflation, i.e., a rise in the price of things, which will require you spend more for the same expenses. Therefore, you need to map out a foolproof retirement plan that should help you overcome these loopholes.

Before that, the biggest confusion for many people could be the ideal time to start planning for retirement. Now, there is a simple way to deal with it, i.e. to start as soon as possible. This means the earlier you can start, the better it is for you.

When you begin the process in advance, you can get enough time to accomplish the goals. Moreover, the journey becomes easier and less complicated. When you start early, you can recover from financial setbacks while keeping up with the savings process.

For example, you have applied for 12-month guaranteed loans and got scammed. This is because no such loans exist that come with 100% approval assurance. That loan offer was a trap, and it gave you some severe financial shocks.

This type of critical situation might need you to pause contributing to financial goals for some time. If you have started retirement planning in advance, these sudden cash problems will have no major impact on your savings journey.

Explore this blog to understand the right time and age to get started with the retirement planning process.

Why starting early to plan for retirement may help you?

Time is a crucial catalyst in financial planning. When time is on your side, recovering from setbacks is possible without feeling any major impact. Therefore, you can be in a position to take risks without much apprehension.

By beginning the savings process in advance, you can take advantage of the power of compound interest. The returns will be significant even when you start with smaller contributions.

The reasons for an early start, even when it is about retirement planning, are:

·         You do not have to go through the tremendous financial pressure usually caused by saving goals

·         Gathering a substantial amount of savings is easier in your 20s than in your 40s

·         No need to make drastic sacrifices to be able to save enough for the retirement phase

·         Changes in financial condition cannot largely influence the savings process

6  Retirement planning at different ages

The plan needs to be modified according to your age, financial condition and capacity to save.

1.      Saving for retirement in your 20s

This is the age when you can start small, as you are supposed to get ample time for the saving process. However, this does not mean that it should be an inconsistent process.

Consistency is vital, or else you will never be near what you expect to save for your retirement.

What should you focus on?

4  Get started with a small amount, but be consistent in your contributions

4  Utilise free opportunities like an employer’s contributions towards your pension

4  Take more risk by opting for higher-growth investment strategies for good returns

Tips to follow

4  Make it a point to build saving money as a habit first, and starting with small contributions can help

4  Avoid seeking perfection and accomplishing great outcomes just after starting out

4  For effortless savings, you can opt for the auto-debit facility that ensures consistency and effectiveness

2.      Saving for retirement in your 30s

This particular age spot might seem safer to start as your income stabilises during this phase. However, alongside earnings, your expenses will grow because of various new responsibilities adding up.

This is the time when you can work harder to map out things strongly in favour of your retirement.

What should you focus on?

4  Your income will grow, and you must increase your contributions to savings

4  Understand your aspiration around retirement and monitor your savings goals from time to time

4  Diversify your investment portfolio so that you can balance risk and growth and get desired outcomes

Tips to follow

4  Control your spending habits even when your income grows, to have a balanced lifestyle

4  Find out how you can use even a small hike towards growing your retirement savings

4  Prevent yourself from making random, bigger purchases without planning and saving

3.      Saving for retirement in your 40s

Maybe this could be the time when you have generated multiple sources of income. This could be an indication that it is time to speed up the process of retirement plans, as not much time is left. You have to cover a lot, and planning should be done accordingly.

What should you focus on?

4  Review how much you have saved versus how much you need to cover

4  Amplify your contributions so that you can beat the desired target

4  Plan effectively so that you can keep up with other financial responsibilities

Tips to follow

4  You must speed up the saving process aggressively, as you are already lagging behind

4  Avoid delays, as they can significantly affect your savings for retirement

4  Prioritise expenses so that you can save more to plug the gap that has been formed

4.      Saving for retirement in your 50s

This is the age when you must be strategizing your investments strongly. You are not in a position to take risks as time is short. Therefore, you must work on plans that can help you get assured returns.

What should you focus on?

4  Maximise the speed at which you have saving so far and never miss an opportunity for additional savings

4  Try to downsize the pile of debts in your life so that you can enter retirement worry-free

4  Review your investments so that you can work with more stable strategies

Tips to follow

4  Calculate how much you will actually need as earning to lead a retired life

4  Add every element, like lifestyle, health etc., so that you can have a planned approach

4  Address other necessities smartly while searching for ways to earn through part-time projects

The bottom line

If you have entered your 60s, you need to focus differently, as priorities will change. This is the phase where you must protect what you have and sustain. It will no longer be about building wealth, but about preserving what you have already generated as wealth.

This is the time when you are about to retire. It does not mean that you should stop the planning process. It is now about focusing on how you will access your savings.