Time to retire? How will you even know?
That’s a good question. One that we often don’t ask ourselves but somehow find ourselves in it when we stop going to the office. When is the time to retire? Is there a time at all? What happens when we retire? Do we stop thinking about renewment then?
Chennai
saravanan@purplepond.in
Planning for retirement is always one of the most anxious things in life and more so if you are salaried. When is the right age? What is the right amount of money saved up? All kinds of questions run through our heads. Here is a simple, basic guide.
Ask yourself these questions:
– Have all my basic goals been met?
– Have I accumulated enough funds to meet the expenses towards my basic goals?
– Is my passive income greater than my active expenses?
If the answer to these questions is YES, then you are “READY to Retire”
Let me now explain in detail what the above questions mean.
Basic Goals
· Goals whose corpus or the time to goal is not in your control, then those goals are called Basic Goals.
· Children’s education/marriage expenses/owning a house for self-occupation are examples of Basic Goals
Passive Income and Active Expense
Passive Income is the income you generate independent of your monthly salary or income from active business/professional involvement. Some examples of passive income are:
· Interest income/dividends
· Rental income
· Royalty income
Active Expense is your lifestyle expenses
Now ask yourself if you are “READY to Retire”