Are you ready for retirement?

If you are in your forties then it is too early to even think of retirement. A job will keep you occupied and not deplete your portfolio so early on.

• Before you retire you must have paid off debts on house, vehicle and so on. Paying hefty monthly installments is a big hole in your wallet, when you do not earn.

• Start planning for your retirement right away. Make an estimate of how much you would need and the lifestyle you would like to maintain. Some people feel they can manage with 50 percent of the current income and others feel they need 80 percent. However, keep in mind you’ll not have high mortgage repayments to make or monthly college fees to shell out. Chalk out a plan.

• Devise an investment strategy. If you are in your thirties, you can invest aggressively in stock and other high risk, high return instruments. Thus, you can make your money work harder for you. As you grow older, move towards low risk fixed income investments.

• Holding most of your money in the form of real estate post-retirement may not be a wise thing as liquidity is very low. Maybe less than a third can be locked in real estate. But the remaining, have it in safer and more liquid instruments. This will be of use in case of any emergency like hospitalisation.