Right upon entering the workforce, the first thing you must do is start investing to build your retirement fund. Not even limited finances should spoil retirement for you. Here is why you must plan for retirement right from the age you start working. Start retirement planning early to have a chance at accumulating the needed corpus. You can use a free online retirement calculator for a simple retirement planning process.
What is a retirement calculator?
An online retirement calculator is a tool that helps in determining your retirement corpus. It is prudent to start planning for your retirement fund to enjoy a stress-free lifestyle post-retirement. A calculator for retirement will help you determine how much wealth you must accumulate before retiring.
Retirement planning requires a combination of both personal and financial planning. Personal planning revolves around personal satisfaction after retirement. Conversely, financial planning helps you budget the required income and probable expenses based on your plan. Retirement calculators can help you with this entire process.
What are the benefits of using retirement calculators?
Here are a few advantages that are associated with online retirement calculators to build your retirement corpus:
- Retirement Planning:
These calculators help in planning the finances for your ideal life after retirement. Dream post-retired life differs from person to person. Be it travelling post-retirement or settling in the countryside, you require money to reach these goals. The online retirement calculator can help you plan your post-retirement life.
- Understanding finances:
They provide a roadmap for achieving your financial goals. You can learn how much you must save/invest monthly to reach your post-retirement financial goals. These calculators also consider other retirement investments. Use these calculators to ascertain how much you must invest to achieve your financial goals.
- Plan and compare:
Retirement calculators can help you plan the diverse ways of achieving your retirement goals. You can use this calculator to your advantage by planning your various investments. Also, it will show you the current mutual fund investments you must modify to achieve your financial goals. You can compare all the plans and determine the one that aligns with your risk appetite and financial goals.
- Easy to use:
Online mutual fund calculators are uncomplicated to use. Enter details like current age, retirement age, monthly expenses, and existing investments to use retirement calculators.
- They are timesaving:
The retirement calculator considers factors like current age, expenses, and retirement age and then calculates the amount required after retirement within seconds.
- They are free:
You can access these calculators easily. Furthermore, you can use the calculator more than once free of cost.
How to use an online retirement calculator?
Here are the steps involved in using a retirement calculator online:
- Enter current age:
Age is one of the factors that help in planning mutual fund investments. The investment strategy for a retirement fund would vary from investor to investor based on their age. For example, someone starting their investment journey at 30 may follow a more aggressive investment strategy. Conversely, an investor beginning at 45 might follow a less aggressive fund allocation strategy. Therefore, your retirement corpus relies on your current age.
- Enter retirement age:
Your retirement and current age will help you ascertain the time available to grow your investments. For example, if you start early at 20 and enter 60 as the retirement age, you have 40 years to grow your retirement corpus. The difference between the current and retirement age is crucial in retirement planning.
- Enter monthly expenditures:
Your spending habits will define your current lifestyle, and the calculator will show you how much you need to maintain your lifestyle after retiring. The calculator will consider inflation and provide the required cost of living as the answer.
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Conclusion:
Following the steps above will help you use an online retirement calculator. These calculators have simplified retirement planning. So, plan for your retirement fund already!
