Where to Invest Before it’s Too Late

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Arwind SharmaReaching retirement age is a milestone in a person’s life. After decades of being an active earning member of the society, it’s time to sit back and relax. You can rely on the funds you have saved over the years to live out the rest of your life in comfort. Savings Goals for SeniorsSecurity: After retirement, the focus is more on preserving the funds on hand and ensuring their security. This is not the age to take risks in volatile investments. Schemes for seniors are designed to provide sufficient interest rates, while ensuring security for the principal invested. In the marketplace FD is the number one investment scheme with assured returns.Liquidity: Getting older may also lead to health related issues. It is best to have emergency funds put aside for these in liquid instruments. These include bank deposits, even in savings accounts, to ensure instant access.Tax Savings: Most savings schemes do not provide high returns. In addition, interest earnings on deposits are taxable. Look for tax-saving schemes and tax-free investments. These can reduce the impact of taxes on investment earnings.Keeping up with Inflation: Improved health care and increasing life expectancy are good news. However, this also means that you should think long-term when planning your retirement funds. While you can put aside a large chunk in secure schemes, make a few investments in growth-oriented schemes. This ensures that your money keeps growing. You can then live the lifestyle you are accustomed to 15 or 20 years into the future.Schemes for EldersSeniors should mix good savings schemes with a few balanced investment schemes.Senior Citizens Savings Scheme (SCSS)This scheme ensures that funds saved over several years stay safe, while earning good interest on the principal. The minimum investment is Rs. 1000 and the maximum is Rs. 15 lakhs under this scheme. It pays an interest of 8.5%, and the interest is computed on a quarterly basis. You can choose to withdraw the interest to create a regular income stream. Alternatively, you can reinvest if you have other sources of income. The tenure is five years, so this is comparatively a liquid scheme. If needed, the scheme can be extended for another three years.Varishtha Bhima YojanaThis scheme, to be offered by LIC, is for a tenure of 10 years. The interest on this savings scheme is 8%, The interest rate will be kept steady to ensure an assured pension scheme for retired people. This is another good option for seniors.Senior Citizens FDBanks and NBFCs offer special rate of interest on fixed deposits for senior citizens that pay a bit higher rate of interest than the regular FDs. Usually, the rate is 0.25 to 0.5% higher than normal fixed deposit interest rates. As fixed deposits will anyway be a part of a senior’s savings portfolio, these are good schemes to choose.Other OptionsIncome funds and Balanced Mutual Fund schemes are also good choices. These give your investment a chance to experience capital growth, to beat inflation. You can also create SIPs where they can invest small amounts regularly in Mutual Funds without risking a huge chunk of money at once. Post Office Monthly Income Scheme is another option to create a regular income source.Once you retire, you’ll need to check the amount accumulated through investments and savings during your employment. Knowing this, you can plan post-retirement investments according to your needs and risk appetite.

Aman is working in the domain of Investment management in one of the top universities. He has published research papers and case studies on

Investment schemes on Fixed Deposit

. He is an avid blogger in the domain of Investment management. you can also find him on social networking platforms.

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