CONTENTS

INTODUCTION WHAT IS RETIREMENT PLANNING ? RETIREMENT PLANNING WHY PLANS FOR RETIREMENT ?
PLANNING BE

NEED FOR RETIREMENT PLANNING RETIREMENT : PREPARED

INDIA & RETIREMENT PLANNING WHAT ARE THE KEYS OF RETIREMENT PLANNING RETIREMENT :HOW MUCH MONEY DO WE NEED ARE YOU PLANNING RETIREMENT ? RETIREMENT PLANNING ADVICE FROM MASLOW STEPS IN RETIREMENT PLANNING WHAT IS FINANCIAL PLANNING ? HOW TO PREPARE FOR RETIREMENT WHEN THERES LITTLE TIME LEFT ELEMENTS OF RETIREMENT PLANNING
ANNUITY

SOCIAL STRUCTURE PENTION PLANS

PRESENT SENARIO OF RETIREMENT PLANNING RETIREMENT EARLY :HOW LONG SHOULD YOU WAIT? RETIRE IN STYLE RETIREMENT PLANNING: WHERE WILL MY MONEY COME FROM? RETIREMENT PLANNING:BUILDING A NEST EGG RETIREMENT PLANNING:ASSET ALLOCATION AND DIVERSIFICATION CONCLUSION BSLI PLAN FOR RETIREMENT LIC PLAN FOR RETIREMENT RESEARCH METHODOLAGY ANALYSIS & INTERPRETATION FINDINGS SUGGESTIONS
BIBLIOGRAPHY CASE STUDY

OBJECTIVES OF THE STUDIES

State the importance of retirement planning

Outline various financial factors that affect sensi le retirement planning Discuss a fe! calculations for the retirement corpus nee"e" Discuss the elements of the retirement planning# $evie! %e& features an" enefits of BS'I Free"om ()

$etirement *lanning+
Intro"uction
Retirement is one of the most important life events many of us will ever experience. From both a personal and financial perspective, realizing a comfortable retirement is an incredibly extensive process that takes sensible planning and years of persistence. Even once it is reached, managing your retirement is an ongoing responsibility that carries well into one s golden years. !hile all of us would like to retire comfortably, the complexity and time re"uired in building a successful retirement plan can make the whole process seem nothing short of daunting. #owever, it can often be done with fewer headaches $and financial pain% than you might think & all it takes is a little homework, an attainable savings and investment plan, and a long&term commitment. 'n this tutorial, we ll break down the process needed to plan, implement, execute and ultimately en(oy a comfortable retirement.

What is retirement?
Retirement is the point where a person is not in any kind of employment )business)occupation. *his usually happens upon reaching a determined age, when physical conditions do not allow the person to work any more. Retirement could also be due to personal choice&either due to ade"uate pension or personal savings or due to a regular unearned income like interest, rents etc. *he retirement age varies from country to country but it is generally between ++ and ,-. .ertain (obs, which are of dangerous nature or of fatiguing nature, may have an earlier retirement age.

$etirement *lanning+
,h& *lan For $etirement/efore we begin discussing how to plan a successful retirement, we need to understand why we need to take our retirement into our own hands in the first place. *his may seem like a trivial "uestion, but you might be surprised to learn that the key components of retirement planning run contrary to popular belief about the best way to save for the future. Further, proper implementation of those key components is essential in guaranteeing a financially secure retirement. *his involves looking at each possible source of retirement income.

Need For Retirement Planning

'ncreasing 0ife 1pan 0ow Returns 'n .onventional 2odes 3f 1avings. 4nintended .ontingencies. 'ncreasing 2edical .ost. 5iminishing *rend 3f 6oint Family 1ystem 'nflationary *rends 7bsence 3f 1ocial 1ecurity /enefits /y *he 1tate 8ursuing #obbies Falling 'nterest Rates MANAGING POST-RETIREMENT RISKS: A G I!E TO RETIREMENT P"ANNING !e live in an era marked by periods of economic uncertainty and volatility. 7t the same time increased responsibility has shifted to individuals for securing their financial well being in retirement. 7nd with this added responsibility, retirees may be exposed to a variety of risks that can affect them both as individuals and members of society. Recognizing this growing trend towards individual responsibility and the risks that may be encountered, the 1ociety of 7ctuaries $137% launched a broad research and information effort in the late 9::-s to raise awareness of post&retirement challenges and seek ways to address them. 7s part of this ongoing effort, the 137 published an informational chart in ;--< that explained the risks of retirement and served as an educational tool to help individuals prepare for them. 'n everyday language, the chart provided a comprehensive summary of the risks and complemented other retirement planning material. !ith the passage of time, the creators of the original chart recognized there would be value to updating it with insights into recently introduced products, legislative changes and new issues confronting retirees. 7s a result, the 137 is pleased to make available this new version. 'n the following pages you=ll find discussions of key financial risks that individuals may face in their retirement years and strategies for managing them. *he risks described include issues related to longevity, investments, health, loss of loved ones and more. !e encourage you to familiarize yourself with the chart, (ot down notes as you read through it, and use it in combination with other planning material. 't is our hope that this information will not only lead to better&informed decision making, but help individuals plan and en(oy a more rewarding retirement.

2anaging one=s own retirement funds over a lifetime has many pitfalls, even with expert help. >obody knows how long the money must last. 0ife expectancy at retirement is an average, with about half of retirees living longer and a few living past 9--. 8lanning to live to a certain age is risky, and planning to live to the life expectancy for someone their age will be inade"uate for about half of retirees. 'n theory, retirees want to make sure their money will last a lifetime without cutting back unnecessarily on their lifestyle. 'n practice, unexpected events may make this very difficult. 7 licensed insurer is the only entity outside the government that can contractually guarantee to pay lifetime income. Financial products from other firms could run out of money to pay income to a long&lived individual. /esides longevity, the other risks listed below can cause a retiree to run out of money. 1omeone who lives many years has greater exposure to these other risks. 0ong lifetimes are difficult to predict for individuals. 't=s easier to predict the percentage of a population with a long life than to predict this for an individual. !ives outlive husbands in most cases. 1ocial 1ecurity, traditional pensions and payout annuities all promise to pay an individual a specified amount of income for life. *hey may also pay income after death to the spouse or other named survivor. 1ome newer products can help protect retirees against outliving their assets? 7 reverse mortgage converts home e"uity into lifetime income, although administrative charges can be high. @0ongevity insurance is an annuity that does not start paying benefits until an advanced age such as A+. *his niche product may fit into a carefully designed financial plan. @2anaged payout plans, offered in several forms by financial services firms, draw down one=s assets gradually. 'ncome from such plans either is not guaranteed or is guaranteed at a lower level than would be available from a payout annuity that has the same cost.@8ayout annuities, also called immediate or income annuities, can be useful for retirees to purchase because they maximize the amount of guaranteed lifetime income available from a sum of money. @5eferred annuities and @variable annuities, normally purchased before retirement, are not discussed here. Experts disagree about when annuitization is a good strategy. 5isadvantages include losing control of assets, costs, and inability to leave money to one=s heirs. 7nnuities without inflation protection are only partial protection against living @too long. 7n annuity that seems unattractive to buy at retirement age may make sense later. 2ultiple annuity purchases can be made over time to average interest rates inherent in their purchase prices. 8eople generally should not annuitize all their assets, but they may want to consider annuities in their overall retirement plan. Financial pro(ections can be very useful in retirement planning, but actual experience will differ. 7ll retirees should review their expected income needs and sources at least every few years and ad(ust spending if necessary.

"ONGE#IT$ RISK: O T"I#ING $O R RETIREMENT RESO R%ES 'nflation should be an ongoing concern for anyone living on a fixed income. 'n the recent era of relatively low inflation, workers may not remember the double&digit inflation rates of 9:B,,9:,B or 9:,:&A9. Even low rates of inflation can seriously erode the financial well&being of retirees who live many years. 1ocial 1ecurity and other government retirement programs pay benefits that increase with inflation, but many private pension plans do not. 7verage past inflation can be calculated from historical data, though actual experience over a typical period of retirement may vary widely. 8ast inflation data can provide some help in estimating retirement needs, but there is no guarantee that future inflation will not be greater. 2any investors try to own some assets whose value may grow in times of inflation. #owever, this sometimes will trade inflation risk for investment risk. .ommon stocks have outperformed inflation in the long run, but are poor short&term hedges. *he historically higher returns from stocks are not guaranteed and may vary greatly during retirement years. 'nflation&indexed *reasury bonds grow in value and provide more income as the .onsumer 8rice 'ndex goes up. 2any experts say that retirees= investments should include some of these securities. 'nflation&indexed annuities, not widely used in the 4nited 1tates, ad(ust payments for inflation up to a specified annual limit. 7nnuities with a predefined annual increase also are available. *hese kinds of annuities cost more than fixed payment annuities with the same initial level of income. .ommodities and natural resources often rise in value during long&term inflation, but may fluctuate widely in the short run. 'nflation can be a ma(or issue, especially as retirement periods lengthen, and it is not highly predictable. Retirees can set aside extra assets to permit a gradual increase in income payments. 8roviding for expected inflation one way or another, though costly, is needed in any realistic plan for managing resources in retirement. 5elaying receipt of 1ocial 1ecurity will build up valuable inflation&indexed benefits for retirees and spouses. !hen housing values were increasing, homeowners seemed to have a hedge against inflation. .urrent and future retirees who expected to use their home e"uity as a source of retirement income may be highly disappointed, especially if housing values continue to decline. INF"ATION RISK 0ower interest rates tend to reduce retirement income in several ways? !orkers must save more to accumulate an ade"uate retirement fund. Retirees earn less spendable income on investments such as .5s and bondsC any income reinvested earns lower rates.

D 8ayout annuities yield less income when long&term interest rates are low at the time of purchase. 0ong&term and short&term interest rates can vary within a wide range. 4nderlying forces that drive interest rates include expected inflation, government actions and business conditions. 'mmediate annuities that provide fixed income are a way for retirees to ensure stable income despite changes in interest rates, although inflation will still be a problem. 'nvesting in long&term bonds, mortgages or dividend&paying stocks also offers protection against lower interest rates, although the value of these investments will fluctuate. *he risk is that rising interest rates will reduce the value of such assets available to meet unexpected needs. 0ong&term interest rates often move up or down at about the same rate as inflation. #igher real interest returns, above rates of inflation, usually make retirement more affordable. *his occurs when retirees= assets include sizeable amounts of interest&paying bonds, .5s, etc. #owever, some retirees have ad(ustable&rate mortgages or substantial consumer debt, so that higher interest rates are an added burden. For these retirees, the higher interest rates that accompany increased inflation may reduce their spendable income at a time when it=s most needed. INTEREST RATE RISK 1tock market losses can seriously reduce one=s retirement savings. /ut common stocks have substantially 3ut performed other investments over time, and thus are often recommended for retirees= long&term investments as part of a balanced investment allocation strategy. 'ndividual stocks rise and fall based on the outlook for the stock market and the specific company. 'ndividual stocks are more volatile than a diversified portfolio. 1tock index funds are diversified, and usually achieve slightly above&average investment returns, but they still are exposed to the ups and downs of the stock market. 1tock market investors should diversify widely among investment classes and individual securities, and be prepared to absorb possible losses. /ecause such losses may take many years to recover, older employees and retirees should be especially careful to limit their stock market exposure. #edge funds may offer some protection, but they can be complex and have high expense charges. 1ome financial products let an individual invest in stocks and guarantee against loss of principal. #owever, risk charges and other expenses may be high and the financial firm may limit losses by shifting most funds to bonds. Eounger workers can afford to take more risks because they have time to make up short& term losses and can postpone retirement. 3lder individuals should allocate a smaller proportion of assets to the stock market. 0ife&cycle or @target funds gradually shift some of their assets out of stocks as the individual gets older. !hen significant personal assets are in company stock, the risk of losing one=s (ob is compounded by possible loss of savings if the company does poorly or goes out of business. Even if the company appears strong, it=s safer to diversify those assets among other investments.

STO%K MARKET RISK 0oss of retirement funds can occur if? 7n employer pension plan sponsor goes out of business. 7n insurer that is providing annuities becomes insolvent. 7ssets held in a participant=s defined contribution plan account lose value. Risk of such loss depends on the individual=s investment allocation, and includes possible failure of the employer=s business if much of the account is invested in employer stock. *he risk of insolvency for an employer or insurer is closely related to its credit rating in the bond market and, in the case of an insurance company, its claim paying ability rating. *hose with top ratings are safest, but ratings sometimes fall rapidly when business conditions or information changes. /enefits in most defined&benefit private pension plans are insured by the federal 8ension /enefit Fuaranty .orporation up to certain limits. 7nnuitants are covered by state insurance company guaranty funds up to specified limits in the event of insurer insolvency. 5efined contribution plan participants need to diversify investments. !here the plan automatically includes heavy concentration in employer stock, participants should look to other assets for diversification. 'f a defined benefit plan is also provided, this automatically gives some diversification. 7 pension plan can be terminated even if the employer remains in business. 4nder defined benefit plans that are not covered by 8/F. insurance $e.g., state and local government employee plans, church plans%, benefits can be lost on termination. & SINESS RISKS 2any retirees plan to supplement their income by working at a bridge (ob part&time or full& time. *oday=s (obs often make few physical demands, and may even be done at home. 1ome organizations prefer to hire older workers because of their stability and life experience. /ut success in the (ob market may also call for technical skills that retirees cannot easily gain or maintain. Employment prospects among retirees vary greatly because of demands for different skills, and can change with health, family or economic conditions. 7bout half of all retirees retire earlier than planned, often because of (ob loss or poor health. Retirement plans rarely allow for phased retirement, so a bridge (ob usually means working for a new employer. Re hiring of retirees also is growing more common. *hese kinds of (obs often have lower pay or benefits, and are more sub(ect to layoffs. 8ostponing retirement may be the most powerful way for workers to improve their retirement security. *his allows their retirement savings to keep growing while the workers accumulate more benefits from 1ocial 1ecurity and retirement programs. Retirement planning should not rely heavily on income from a bridge (ob. 2any retirees welcome the chance to change careers and move into an area with less pay but more (ob satisfaction, or with fewer demands on their time and energy. *erminating employment before age G+ may make it difficult to find a source of affordable health insurance before

2edicare is available. >ote that .3/R7 coverage usually ends after 9A months $<G months if disabled%. EMP"O$MENT RISK 8olicy risks include these possible changes? 'ncrease in taxes $income, property, sales, etc.%. >ew kinds of taxes such as a consumption tax or value&added tax. Reduction in entitlement benefits from 1ocial 1ecurity, 2edicare and 2edicaid. 'ncrease in retiree contributions for 2edicare #igher payments by high&income retirees are already scheduled. *ighter income standards for 2edicaid and other means&tested programs. .hanges that may include benefit cuts or higher taxes will be needed to pay benefits to aged baby boomers. 1uch benefits include 1ocial 1ecurity, 2edicare and veterans= benefits. 2unicipal bonds, Roth 'R7s and Roth B-9$k%s have a tax&free status that offers protection against higher income tax rates. .onverting a traditional 'R7 to a Roth 'R7 will lock in current income tax rates. /ut new kinds of taxes could reduce the purchasing power of such @tax&free income. #istorically, .ongress has been very reluctant to reduce benefits promised to current retirees. 3lder workers also may escape benefit reductions, but young workers= future government benefits are less safe from reduction. 4nder current law, more and more retirees will pay income tax on their 1ocial 1ecurity benefits because the dollar exclusion from taxation does not rise with inflation. P &"I% PO"I%$ RISKS Unexpected health care costs are a major concern. Employers continue to cut back on post&retirement health care benefits. 0ow&income retirees may spend a large percentage of their resources on health care. 2edical technology improvements that extend life may increase health care costs. #ealth care costs are? Relatively easy to predict for a large group over a limited time. #ard to predict for individuals. Hery hard to predict far into the future. 2edicare is the primary source of coverage for post&G+ retirees. 1upplemental coverage is available from employer plans and individual 2edical gap policies or #23s. 3ther federal or state&local programs may assist low&income retirees. 'nstead of retiring from a (ob with health benefits, employees may choose to keep working, at least

part&time, in a (ob that will allow them to remain covered Future resources are hard to predict because a high level of uncertainty exists about the future design of 2edicare. 'n a typical group, a small percentage of individuals usually account for a large percentage of the group=s overall health care costs. 't=s not too late for retirees to reduce their risk of ma(or health problems by lifestyle changes involving diet, exercise, smoking, etc. NE'PE%TE! (EA"T( %ARE NEE!S ) %OSTS Facilities or caregivers sometimes are not available for acute or long&term care, even for private paying individuals. .ouples may be unable to live together when one of them needs a higher level of care, thereby increasing cost and emotional stress. 'ndividuals may want to review private and public support programs available where they intend to live. 'n some cases, individuals may be able to choose a general area of residence to improve access to care. 0ack of appropriate facilities or caregivers may force people into a higher level of care, or cause them to be without needed care. *he current shortage of health&care workers may become worse. "A%K OF A#AI"A&"E FA%I"ITIES OR %AREGI#ERS .hanges can be sudden, tied to an illness or accident, or gradual, perhaps linked to a chronic disease. 2ultiple problems are common when physical or mental capabilities decline. *he percentage needing help rises substantially with age, but changes in individual cases often are hard to predict. 'nsurance for long&term care covers disabilities so severe that assistance is needed with daily activities such as bathing, dressing and eating. 1ome policies re"uire a nursing home stayC others do not. *he cost of long&term care insurance is much less if purchased at younger ages, well before anticipated need. Functional status may be hard to measure, and different insurance products may use different definitions of limitations. 't=s better to look for less&severe definitions when purchasing insurance. 2edicaid covers a large share of total nursing home costs and may cover assisted living, with benefits available only to people with very low or no assets. 5efining functional status can be a problem. For example, @difficulty in using telephone might mean? .an=t use phone at all. .an answer a call but not place one. .an=t look up number to call but can use speed dial. .an use phone on limited basis but not use answering machine. >one of the limitations on using the phone would trigger benefit eligibility under long&term care insurance, but they may trigger the need for help. 1pousal protection rules $which vary by state% need to be considered when deciding whether 2edicaid would help. .are options are linked to housing choices and these are evolving.

"OSS OF A&I"IT$ TO "I#E IN!EPEN!ENT"$ 1pecial housing for the elderly provides a range of services including help with activities of daily living and sometimes with ongoing health care too. #ousing that includes care can be "uite costly. 1ome housing focuses on care for specific diseases or conditions. *he most appropriate form of housing for an individual in a given situation may not be available in the chosen geographic area, or may have a long wait for entrance. >eeds at time of retirement are predictable unless the individual is disabled. Future needs are hard to predict because they vary with the ability to functionC for example, stairs may become a barrier. 1now removal and yard care can also become problems, but can be contracted out. 1pecial housing is financed mainly from personal assets and current income. Retirement income planning may allow for increases tied to inflation plus significant increases later to cover different types of housing. 2edicaid and)or long&term care insurance may cover part of housing costs if merged with care. .hoices depend on personal preference and functional status plus financial and family resources. #ousing can be a ma(or asset in retirement. 7 home can be converted to cash by selling it or using a reverse annuity mortgage. @.ontinuing care retirement communities include elements of advance funding of costs for long&term care and medical care.

%(ANGE IN (O SING NEE!S *he death of a spouse is a ma(or change in family situation that is often accompanied by a decline in economic status? 1ome income may stop at the death of a spouse or former spouse. *he death of a disabled person=s caregiver spouse may bring financial problems at a very difficult time. *he surviving spouse may not be able or willing to manage the family=s finances. 'nability to cope with a spouse=s death or terminal illness contributes to high rates of depression and suicide among the elderly. 't can be difficult to predict which spouse will live longer in individual cases. !omen are widowed more often than men. 2any financial vehicles are available and can be used in combination? 0ife insurance 1urvivor income in 1ocial 1ecurity, pension plans and annuities 0ong&term care insurance 1avings

!ills and estate planning are important tools to provide for a surviving spouse. 1ome experts say that a surviving spouse needs about ,+ percent of the couple=s income to maintain living standards. !idows= financial resources are very low in many cases. 8overty rates for elderly widows are about 9+ percent compared to B percent for married couples. 1ocial 1ecurity provides continued benefits to survivors based on their personal work and family status. >ote that a single&earner family survivor generally gets two&thirds of the combined family benefit that was payable while both were alive, whereas in a dual&earner family with e"ual earnings, the survivor gets only about half of the combined benefit. 'n this case and many others, the reduction in 1ocial 1ecurity benefits after death of the first spouse is much greater for a two&earner couple than for a single&earner couple. 2arried couples may want to choose their 1ocial 1ecurity retirement dates carefully to increase potential surviving spouse benefits. *his may mean that the lower earner applies for benefits at age G; and the higher earner waits until age ,-. !EAT( OF A SPO SE 2arriage and divorce can affect benefit entitlement under public and private plans. 1ome of these effects may not be well understood. For example, a woman sometimes can maximize her 1ocial 1ecurity benefits by first applying as a widow or divorced spouse, later applying at age ,for benefits credited on her own record as a worker. 5ivorce can create ma(or financial problems for either party. 7 substantial percentage of marriages end in divorce. 2any women are alone in retirement. 5ivorce or marriage after retirement age is not uncommon and should be recognized as a possibility. *his is a personal issue. *here are no formal programs. 'n divorce proceedings, the law allows for division of private pension plan benefits covered by ER'17. For this purpose, divorcing spouses need a properly drafted "ualified domestic relations order $I5R3%. 3lder couples who marry, especially those with children, may want a pre&nuptial agreement that defines each party=s rights to distribute or dispose of property as they wish, not as a court would decree. 'n divorce proceedings, retirement benefits may get transferred from one spouse to the other, depending on decisions of the parties and the divorce court. .ouples considering whether or not to marry need better information about how their decision affects benefits from 1ocial 1ecurity, 2edicaid and retirement or survivor programs. 7t marriage, an individual may gain rights to survivor=s benefits under 1ocial 1ecurity and retirement programs. 2arriage or remarriage may result in the loss of some benefits. OT(ER %(ANGE IN MARITA" STAT S Retirees and surviving spouses may lack financial skills and (udgment, especially at advanced ages if mental capabilities decline. *hey often are preyed upon because of their substantial assets and fading cognitive skills. Friends and relatives may be un"ualified to advise them about some issues or even have bad motives. 1alespeople and brokers may promote products or investments that are unsuitable. 1ocietal changes are resulting in greater use of paid caregivers instead of family members. .aregivers,

financial advisors, or scammers may have access to retiree assets, personal belongings, '5 data and passwords. Exposure may increase as retirees directly control more assets, financial products become more complex, more retirees use computers, and scammers become more adept. #owever, good advice and good products are increasingly available to people who seek them out. #ere are some precautions retirees can take? 0earn the 7/.s of investing and handling money. Fet advice from "ualified and trustworthy sources including 4.1. 5epartment of 0abor and employer&sponsored programs. Jeep decision&making simpleC make sure all options are understood. Fet several opinions on important issues. /e very cautious in giving control of assets to any professional or in dealing with strangers personally or online. 'n later years, expect to rely more on trusted family members or professionalsC investigate and choose such people long before a need for their help suddenly arises. 4se paid caregivers who are bonded. Even a well&educated person with a financially secure retirement may be exposed to substantial loss from these sources. Few people have the wide range of expertise needed to give good advice in every situation, so it=s important to have access to different sources of advice. 4sing traditional pensions or payout annuities reduces some of the risks noted here. &A! A!#I%E* FRA ! OR T(EFT 2any retirees find themselves helping other family members including parents, children and grandchildren. Retirement planning should recognize any obligation to assist such family members. 7 change in health, employment or marital status may upset such plans and call for greater personal or financial support from the retiree. Fenerally, family members are known at time of retirement, but new grandchildren may come after retirement. 1ometimes people remarry after retirement. 3lder children or grandchildren often need money for higher education, and a few need special help to deal with physical or mental handicaps. *heir parents can usually foresee such cases by the time they retire and try to plan accordingly. 7dult children may look for help in case of unemployment or financial setback. 1ocial 1ecurity and other government programs may pay benefits to family members other than the worker=s spouse. 7n increasing number of grandparents are the primary caregivers for their grandchildren today.

n+ertaint, o- So+ial Se+.rit, and Pension &ene-its

First off, we need to be up front about the prospects of government&sponsored retirement & they re not very good. 7s we all know, the developed world s populations are continuing to age, with fewer and fewer working&age people remaining to contribute to social security systems. greater and greater burdens are being placed on the system, as more and more people retire and, due to advances in health care, are living longer than ever before. *his Kdouble&whammyK effect holds the potential to put significant strains on the system and could leave governments with no other viable option but to reduce social security benefits or suspend them altogether for all but the poorest of the poor. 8rivate pension plans aren t immune to short comings either. .orporate collapses, such as the high&profile bankruptcy of Enron at the turn of the century, can result in your employer&sponsored stock holdings being wiped out in the blink of an eye. 5efined&benefit pension plans, which are supposed to guarantee participants a specified monthly pension for the duration of their retirement years, actually do fail every now and again, sometimes re"uiring increased contributions from plan sponsors, benefit reductions, or both, in order to keep operating. 'n addition, many employers who used to offer defined&benefit plans are now shifting to defined&contribution plans because of the increased liability and expenses that are associated with defined&benefit plans, thus increasing the uncertainty of a financially secure retirement for many. *hese uncertainties have transferred the financing of retirement from employers and the government to individuals, leaving them with no choice but to take their retirement planning into their own hands.

n-oreseen Medi+al E/0enses

!hile the failure of a social security system may not occur, planning your retirement on funds you don t control is certainly not the best option. Even with that risk aside, it s important to realize that social security benefits will never provide you with a financially ade"uate retirement. /y definition, social security programs are intended to provide a basic safety net & a bare minimum standard of living for your old age. !ithout your own savings to add to the mix, you ll find it difficult, if not impossible, to en(oy much beyond the minimum standard of living social security provides. *his situation can "uickly become alarming if your health takes a turn for the worse. 3ld age typically brings medical problems and increased healthcare expenses. !ithout your own nest egg, living out your golden years in comfort while also covering your medical expenses may turn out to be a burden too large to bear & especially if your health $or that of your loved ones% starts to deteriorate. 7s such, to prevent any unforeseen illness from wiping out your retirement savings, you may want to consider obtaining insurance, such as medical and long& term care insurance $0*.%, to finance any health care needs that may arise.

Estate Planning
1witching to a more positive angle, let s consider your family and loved ones for a moment. 8art of your retirement savings may help contribute to your children or grandchildren s lives, be it through financing their education, passing on a portion of your nest egg or simply keeping sentimental assets, such as land or real estate, within the family. !ithout a well&planned retirement nest egg, you may be forced to li"uidate your assets in order to cover your expenses during your retirement years. *his could prevent you from leaving a financial legacy for your loved ones, or worse, cause you to become a financial burden on your family in your old age.

The Fle/i1ilit, to !eal With %hanges

7s we know, life tends to throw us a curve ball every now and then. 4nforeseen illnesses, the financial needs of your dependents and the uncertainty of social security and pension systems are but a few of the factors at play. Regardless of the challenges faced throughout your life, a secure nest egg will do wonders for helping you cope. Financial hiccups can be smoothed out over the long term, provided that they don t derail your financial plan in the short term, and there is much to be said for the peace of mind that a sizable nest egg can provide.

IN!IA ) RETIREMENT P"ANNING

:-L per cent of 'ndia=s total working population is not covered for postretirement life. *he main ob(ective of retirement planning is to create a well funded and safe future for the client. Financial needs of the client needs to be clubbed between his)her current income and post retirement expenditure. *o maintain up current life style one has to plan to save almost G+ to A+L of current income. "i-e %,+le Every phase of life cycle has a different level of income, expenditure and saving. *he first phase of life cycle is the childhoodwhere an individual has no earnings but certain amount of money is spent on him/her (school fees, clothing, food etc).

1econd stage comes where the individual may or may not start his real earnings or a stable career. 'n the third stage an individual enters a stable career and has good amount of earnings to save and start planning for his)her retirement

Fourth M fifth stage is time period to save maximum and allocate maximum funds for the retirement planning. 'n the sixth stage comes the old age. 7t this stage the savings tend to reduce because of medical expenses, new expenses related to old age etc. *he last two stages of the life cycle is the retirement period where the saving are utilized to cover the real retirement years or retirement costs. %areer Sta1ilit, .areer stability is one of the most important factor which clearly needs to be evaluated to develop a retirement plan. Fund allocation for retirement is done with the help of surplus earnings of an individual during his)her pre&retirement period. 1table career and in return stable earnings provides a scope for having well planned and organized retirement plan Employers also have a important role in retirement planning as they contribute in pension plans other contribution plans etc. .areer stability helps to draw clear anticipation of future earnings can be which helps in retirement planning

Ma2or Fa+tors A--e+ting %areer Sta1ilit, Jo Satisfaction+ 6ob satisfaction covers the factors like the level of pay and benefits, the perceived fairness of the promotion system within a company, the "uality of the working conditions, leadership and social relationships, and the (ob itself. .lternative opportunities: 'f the market is opening up for new (obs and careers and individual can provide his works onto those opportunities the career stability can embark for changes. Emplo&er/Emplo&ee $elationship+ *his issue covers the factors like loyalty of an individual towards the employer, future protection provided by the employer, motive .hanging economic conditions? *he economic conditions of a country like recession cycles, developing sectors, problems related to any particular sector private and public ownership etc also affects the career stability. There are also various policies and economic strategies of government related to employment M foreign investments etc which have a direct affect on employment scenario. 'ntroduction 't is an interactive part of retirement planning. 'n pre&retirement counseling all the basics of the retirement plan are drafted as per the needs and expectations of the client and as per the client=s present and anticipated financial conditions.

Financial planner has to clearly evaluate the needs, attitude M lifestyle of the client to have a strong and trustworthy relationship with the clientation, leadership, timely appraisals.

Steps For $etirement *lan

Inauguration Of $etirement *lan: 'nauguration of retirement plan would depend on life expectancy. 'f the client starts accumulating funds for his)her retirement early, with small savings M less burden he will be able to achieve the goal. Desire" $etirement Status+ *his would involve budgeting, income sources and proper asset management etc. Estimated expenditure and sources of income during the retirement years to the client have to be evaluated properly. $etirement E0penses 1 Sources Of Income: .lear identification of all the costs M incomes has to be made. 8rovisions for allocating G+ to ,-L of current income for the retirement period should be drawn.

Insurance ,ith $etirement *lanning

'nsurance plans with a cash back or whole life insurance are suitable because they provide insurance as long as the premiums are paid and also accumulates savings, thus it has a cash value. 't also helps to pay off uncovered medical costs, funeral expenses M also acts as an income replacement for survivors. !ith increasing life expectancy, and other challenges a life insurance can provide a life&long, worry&free retirement and insurance protection. 2a(or expenses of the retirement years are the health care costs, health insurance can act as a helping hand in that case to meet up these costs. !ith increasing life expectancy, and other challenges a life insurance can provide a life&long, worry&free retirement and insurance protection.

 2a(or expenses of the retirement years are the health care costs, health insurance can act as a helping hand in that case to meet up these costs. Estate planning should maintain out the costs of the property and should develop an estate plan to give proper and safe income generation. Estate plan will cover all the legal formalities and all the documentation regarding future transactions. Ta/ Planning With Retirement Planning 1avings and investments are interconnected. 8roper management of savings and investment results to tax benefits and these become very important at the time of retirement. Retirement planner must clearly evaluate the aspects of its li"uidity, security, and the most important one the return and tax income over such investments. 8roper tax planning can itself prove out to be a saving tool because with effective tax planning is basic foundation for effective retirement planning.

Retirement Planning - &e Pre0ared

When most people consider retirement planning, they think only of financial issues making sure they ha!e enough money and resources to meet their needs. "ften the emotional, physical, and spiritual aspects of life are ignored. #onsider the follo$ing tips.

Retirement Planning - &e Pre0ared Emotionall,

Emotional preparation is essential for good retirement planning. Eou need a purpose, a reason to retire. @2y husband and ' love to travel, so we visited 2aine, >ova 1cotia, >iagara Falls, and #ershey, 87 during our first year of retirement. !e also make it a priority to visit our children several times each year. !e love being with our grandsons especially during the holidays. ' always take plenty of my books to give to those who may need a word of encouragement. 7nother aspect of preparing emotionally for retirement is humor. 0augh at yourselfN 2edical science now acknowledges that the best resistance against disease is laughter. *he /ible says, @7 cheerful heart is good medicine, but a crushed spirit dries up the bones .

Retirement Planning - &e Pre0ared Ph,si+all,

8reparing physically is important to retirement planning. Eating nutritional foods and exercising is essential. 5rink at least G glasses of water each day. @'=ve noticed that my body has a softer and more radiant look when ' drink more water. 2y face takes on a glow when ' drink six to eight glasses of water each day. !e need this refreshing drink to keep our body active and healthy. 2ake a habit of keeping plenty of fresh, ripe fruits and vegetables around the house for handy consumption. Raw foods digest "uickly and have plenty of nutrients. !hen in a hurry, grab a piece of fruit or vegetable such as carrots, celery, or some nuts and be on your way. Eating the right foods bring great rewards such as feeling better about yourself. /ecome active and stay on the move. .onsider water aerobics or walking while carrying weights. *his helps strengthen arms and legs. Find what you en(oy doing and do itN Eour doctor can help you pick the right exercise for you. /eing active improves your mood, helping you to feel more in control. 't also builds self esteem, which increases motivation. #aving a set time each week to exercise helps control your blood pressure, your risk of developing heart disease, and lowers the risk of cancer and diabetes.

Retirement Planning - &e Pre0ared S0irit.all,

8reparing spiritually for retirement is the key to living the abundant life 6esus talked . 6esus spoke the following words? @*he thief comes only to steal and kill and destroyC ' have come that they may have life, and have it to the full. 7 retired woman wrote, @2y husband and ' both retired from our careers in ;--B. !e are en(oying our retirement to the fullest because we had a plan. Earthly life is a time of preparation not only for retirement but for eternity. !e both love to sit by a warm fire and read and study Fod=s !ord every morning. !e also are active in church singing in the choir and my husband is an usher. !e en(oy fellowship with others. Fod sent #is only beloved son to live and die so we may be the head and not the tail, the lender and not the borrower. 't=s up to us and our relationship with 6esus .hrist that determines how we live. *aking care of ourselves spiritually, emotionally, and physically is the key to en(oying our golden years. *o accomplish the purpose for which Fod created us, we should keep our eyes on becoming the person Fod wants us to be spiritually, emotionally, and physically. 7re you Fod=s childO 7re you sure that you will go to heaven when you dieO 'f not, keep readingN

What sho.ld I +onsider 1e-ore earl, retirement? !hen considering early retirement, it is important that you prepare financially and in other areas too. 3nly ;, percent of workers and +- percent of retirees feel very confident they will have enough money to live comfortably throughout their retirement years. 2oney management is the key when considering one=s options for early retirement. *he ideal time to start planning and saving for early retirement is when people start working, which is usually in their teen years. /ut we all know that most young people are not thinking that far ahead. *hose of us finding ourselves at least a decade or more away from retiring can consider the following and do further research on these topics. !e can identify our needs, interests, and concerns of midlife and aging. !e can think about issues that affect the aging like? 1ocial 1ecurity, 2edicare, and prescription drugs. !e can stay informed about emerging social trends that affect aging like? increasing midlife divorce rates, evolving social attitudes, boomers= civic involvement, and studying the impact that these changes make on our lives. "nce $e ha!e accepted the fact that our li!es ha!e reached the pinnacle of retirement, $e can better prepare oursel!es and our en!ironment for such an e!ent. %he United &tates 'epartment of (abor has published )%he %op %en Ways to *repare for +etirement. ,or those of you $ho li!e outside of the United &tates, research $hether your country pro!ides a similar list. Jnow your retirement needs if you decide to maintain the same standard of living. 't will take ,- to :- percent of your pre P retirement income. Find out about your 1ocial 1ecurity benefits by calling the 1ocial 1ecurity 7dministration or visiting their website. 0earn about your employer=s pension or profit sharing plan, if they have one. .ontribute to a tax&sheltered savings plan, such as a B-9 $J%. 7sk your employer to start a plan. 1imple plans can be set up by certain employers. Eou can order 'R1 8ublication +:- by calling the 'R1 or visiting the 'R1 website. Eou can also re"uest @.hoosing a Retirement 8lan for Eour 1mall /usiness. 8ut your money into an 'ndividual Retirement account $'R7%. 5on=t touch your savings if at all possible. 1tart now, set goals and stick to them. .reate a tight monthly budget and following it closely. .onsider simple investment principles. Jnowledge of your financial security and how your pension or savings is invested is important. /e sure to investigate the companies involved with your investments and stay atop of any fraudulent practices. Eou can always

check with the /etter /usiness /ureau or your state=s 7ttorney Feneral 3ffice.

7lways ask "uestions of your banker, employer, your union, or financial advisor if you need more information. 3ther things to consider for early retirement are plentiful. *o make your money last through your retirement, it will take some thought, research, and planning. #ealth is an unpredictable factor in our lives and the lives of our spouses. !e can consider getting long&term care insurance. 0ifestyle choices of how and where you live will impact your retirement financial security. .ould you be happy living elsewhere, or would you rather stay in your present homeO 's it time for a smaller houseO Eou may get a tax break if you sell your home. !hen opting to sell and move elsewhere, consider these options? .ost of living in the area you wish to move. *he amount of taxes in the state and city that you consider. 5oes the climate of the area suit youO !ill you still have support of family and friendsO 7re opportunities for work available and close byO 8eople must consider cutting their spending. /udget in the items you must have, and keep those separate from the things you would like to own. 7void using credit cards, especially if you have a tendency for impulsive buying. 7void using 7*2 withdrawals to save on extra fees charged by banks and other financial institutions. 1hop around for the things you want, and you will get the items for a more reasonable price. !ork with your spouse to keep your spending within your budget and stick to it. Expect the unexpected, and leave room in your budget for emergency repairs of the furnace, car, house repairs, and ma(or appliances. #ere is how one woman and her husband prepared for early retirement. @5uring the last few years prior to retiring, we started paying off all of our debt. 3ur home and new automobile were paid in full. !e both retired on the same day at G9 years of age. !e have en(oyed each day, doing what we both love? church work, writing, reading, family, and traveling.

What are 3e,s to a ha00, retirement?

%here are three rules for a happy retirement. .reate a steady income by investing a portion of a B-9$J% or savings in an @income annuity, which pays you a guaranteed income as long as you live. *his plan of annuities and having a monthly check for life helps you to have the cash for unexpected expenses. Further research is needed before obtaining annuities to make sure they are from a reputable financial company. 1tay hours a year was enough to satisfy the retiree=s feeling of usefulness. /ut this positive effect disappeared at +-- hours of volunteer service. 1o don=t overdo on the volunteering. 'f it becomes a chore, you re doing too much. 'f at all possible, try to control your timing for retirement. !e can=t control being forced into retirement by ill health, disability, or company downsizing. *his accounts for ,+ percent of involuntary retirements. 't pays for us to plan for such an occurrence. !e can pay for health insurance coverage while we are in a healthier condition, because ing active increases your ability to en(oy retirement. Holunteering up to ;-- many companies will not 1haring what Fod has blessed us with is a key to a happy retirement. *he blessings of Fod are a gift to share with othersQfor we are blessed to be a blessing. !hen we give to others our basket of life seems to overflow with the goodness of Fod. Recently, ' donated several copies of a book ' have written to an organization that helps women coming out of prison. *he head of this organization said she would be teaching this as a /ible study. 1he could not thank me enough for these books. Eet, ' was the one most blessed in giving to those who have such a need. Fod loves a cheerful giver. !hen we give out of love there is (oy expressed in our giving. 8eople will see and know there is something special in your gift. @Eour basket and your kneading trough will be blessed. Eou will be blessed when you come in and blessed when you go out cover prePexisting conditions as we get older.

$etirement+ Ho! 2uch 2one& Do ,e 3ee"3ne concern many people have prior to retiring is whether they will have enough income and assets to get them through. *his is even more the case when we plan to retire early or there are existing expenses.

Common Consi"erations Stages

*here are typically several stages in retirement, each with different spending patterns. Retirees usually spend more when they first retire. *his generally lessens over time, because activity levels moderate. #owever, sometimes this is not the case, such as with unexpected medical bills. Ho! to Tal% to 4our Chil" a out Death + 't is important to take the time to talk with your child about these unexpected events. Eou want to make sure that your child knows that he or she will always be cared for. & B days ago The 4oung *rofessional+ ,h& Do I 3ee" an Estate *lan'f you are a yo have no need for estate planning. *he truth is everyone over the age of 9A should have an estate plan in place. & + days ago Estate *lanning+ ,ill 2& 2e"ical ,ishes Be Follo!e"-

2any people choose to outline their health care wishes in their estate planning documents. *his allows you to place control over your life in advance so that when you are unable to make important... & G days

.re 4ou *lanning For $etirement*here s more to planning for retirement than (ust the money aspect. 8reparing for the best time of life is an exciting and fulfilling process. *oday, your retirement could very well be a full one&third of your life & <-R years. Retirement is the time of life where you choose to do what you like to do best. 1o, planning for this important time is essential. /aby boomers have a uni"ue opportunity. 7s always, we have reinvented each stage of life compared to previous generations. !e want to do it our way. 7re you approaching your retirement yearsO 7re you being forced into retirement because of downsizingO 3r are you early in your career and want to really plan aheadO Eou ve come to the right place. ' m a baby boomer that found myself being forced to retire due to downsizing. 1o ' had to do some "uick retirement planning. Differences Each of us is uni"ue and our retirements are spent in different ways. /ecause of this, there is no way of knowing for sure how much money will be enough at retirement.

T&pes of E0penses
-f you retire with existing expenses, you need to include these in your budget. Eou also need to factor in if you are retiring early, if you pay rent, and whether you will be able to work, if need be.

I"eal *ortfolio
'n retirement, the ultimate portfolio would provide cash for emergencies, a steady flow of income that increases faster than inflation, and defense against market slumps. *he short answer is that different people need different amounts of money when they retire, and there are too many variables to say how much is really enough. Eour estate planning attorney should coordinate closely with your financial advisors to ensure that your retirement and your estate plan continue to meet your needs.

,h& retirement plans3ur pension plans are designed to ensure that your retirement years truly become your golden years. *hey will provide you the financial security to pursue your unfulfilled dreams.

,hat is retirement insuranceRetirement insurance ensures that you or your family members receive a regular pension amount post a retirement date. Eou have the flexibility to choose the retirement date and the manner in which you receive the pension.

,h& "o I nee" retirement insurance"onger retirement ,ears . 7verage life spans are increasing in 'ndia and hence, the retirement years are likely to be longer. !ith the rise in inflation you will need more money to live in comfort. Finan+ial inde0enden+e 0ost retirement : Earlier, people could depend on their children to take care of them post retirement. #owever, as a modern individual, would you not like to maintain your financial independence post retirement alsoO In-lation : 'nflation is an important factor. 8ost retirement, you need a regular income to ensure that your expenses can be met.

Ho! much retirement plan "o I nee"8ost retirement, you would like to maintain your life style and also need to take care of increased medical expenses also. Eou can arrive at the exact #uman life Halue #0H by using the Retirement .alculator.

,h& shoul" I start planning for m& retirement no! *he earlier you start planning for retirement, the larger will be the corpus for you at the time of your retirement. >eglecting your retirement needs can prove to be costly later in your life. !ith age, your expense will tend to increase and therefore retirement planning becomes more difficult. 7part from the benefit of a comfortable retirement, also en(oy tax benefits as per prevailing tax laws.

$etirement *lanning *rogram / planning is more important than the plan

7 retirement planning program comes in a number of guises. 't may be one of the many, and some very comprehensive, computer programs that will take your assumptions and with perfection calculate the results. 't may be one of the many structured training programs being offered by various institutions for people nearing retirement. Finally it may be a personally crafted program which integrates all the tools and advice along the way to get your customized retirement plan. *he computer retirement planning program is a useful tool in your overall retirement planner but, even the more intricate 2onte .arlversions, have a number of limitationsC *heir apparent precision and accuracy is misleading. *hey are easy to believe them because they calculate results so "uickly and efficiently. *he conclusions are neatly presented *hey are only as good as the human assumptions. *ruthfully no one really knows what is going to happen tomorrow S let alone next year or in + or 9- years time. 4nfortunately the future is not a neat pro(ection of the past. *he course run as a retirement planning program also has limited benefits as it is usually conducted too late. 't is no use finding out a year or two before you plan to retire that your finances don t "uite meet your expectations. *hese courses are useful only in that in doing something is better than doing nothingN *hese courses should be run for young people so that they start thinking about retirement while they can do something about managing it. .hanging it s course *he best retirement planning program would include both these other versions as tools in the overall plan. Recently ' have been asking friends two "uestionsC T7re you concerned about retiringOU T5o you have a retirement planUO 1adly most people ' speak to answer @yes about being concerned and @no about having a plan. 7lthough some do add that they have a financial plan. 3ne which turns out to be a glossy folder with some "uestionable pro(ections put together by a financial adviser ... not really much use without the complete retirement plan. 2y next "uestion regarding their non&existent retirement plan is, Kwhy notOK. *he answers are the usual reasons, or excuses, one hears about planning in general? !hy plan if you don t know what s going to happen in the futureO ' don t know how long ' m going to live ' m bombarded by so many confusing messages and (ust don t know what the economic future will bringO ' m sure everything will be okayO ' ve never thought about itN ' suppose that many of these reasons are true but unfortunately without any plan for retiring you ll be totally unprepared to manage the very challenges and unexpected events that will occur in your life.

4our retirement planning program

Eou should start from the time you start working. *he earlier you start, the better chance you have for success. *o have ade"uate resources to meet your goals and ob(ectives. 1o firstly you must define what you want in your retirement. 'ndividuals have vastly different views on the ideal retirement and these re"uire vastly different amounts of funds to support. !hat does retirement mean to meO !hy do ' want to ' retireO !here would ' like to liveO !hat is my planned retirement lifestyleO !hat would ' like to doO 5o ' have any concerns about my health in retirementO #ow long do we think we ll liveO 5epending on the answers to these "uestions you can then start putting together a financial plan. !ill we have enough moneyO #ow much have we gotO #ow much do we need to saveO !hat specialist information or support do we needO 5o we need to supplement our incomeO !hat contingencies do we want to makeO *o get a final plan you may have to repeat this retirement planning program cycle a number of times and will probably re"uire the input from a financial planner to ensure all the technical and legal issues are understood. *his would be the completion of round one. *o be repeated every year changed as circumstances change. 8ractice makes perfect. Each time you repeat the process you will understand it better. >ever get too complacent as you never know what tomorrow will bring. Regularly reviewing your comprehensive retirement planning program will ensure that you ve done everything possible to make your retirement successful & providing the resources to meet your expectations.

$etirement *lanning ."vice from 2aslo!+ Ho! 2uch Do ,e $eall& 3ee"!hat do we really want our retirement years to be like, and how much will that cost usO #ow much retirement income do we really needO !e can get insights into these "uestions from famed humanist psychologist 7braham 2aslow, who created a framework of human needs now popularly known as 2aslow=s @hierarchy of needs. 2aslow contended that most of us have a fundamental set of physiological and safety that take first priority. 3nce we satisfy these basic needs, we can then devote time and attention to additional needs involving love and belonging, such as friendship, family, and sexual intimacy. !e then have the potential to satisfy a higher level of needs that 2aslow labeledesteem, involving confidence, achievement, and respect. 2aslow called the last, highest level of needs @self&actualization, and these include morality, creativity, problem& solving, and acceptance. 7ccording to 2aslow=s theory, it=s difficult to pay much attention to your higher&order needs when your lower&order needs are threatened. 7nd that can happen pretty easily in our retirement years if we don=t have sufficient retirement income or retirement savings to satisfy our basic needs for shelter, food, health and so on. Fiven this scenario, how can we apply these insights to planning for our retirement yearsO ' have two suggestions? 1pend the least amount of money necessary to do a good (ob of satisfying your lower& order needs, which usually include housing, transportation, food, and medical care. #ere=s where some careful (udgment is needed, as it=s possible to spend much more on housing, transportation, and food than what we really need to be satisfied. 7ccording to 2aslow, life gets really good when we=re satisfying the top three level of needs? love and belonging, esteem and self&actualization. *ake a long, hard look at (ust what it will take you to satisfy those needs. 2ore specifically, ask yourself how much money you think it will cost. 't=s "uite possible that it won=t take as much as you think. 't=s also possible you can work and earn wages doing something that satisfies one of these higher order needs Q now that=s really win&winN 7dvertising can be very persuasive, telling us we can buy our way to happiness and fulfillment. 7ds may try to convince you that a bigger house, a flat&screen *H, or the latest car will help you achieve life satisfaction. /ut those items aren=t in 2aslow=s upper levels of needs, which is a fancier way of saying that money can=t buy you happiness. 1o (ust tune out the ads and pay attention to your own needs. 1ince boomers will need to make every dollar count in their retirement years, you=ll want to think about how to most efficiently secure the lower priority of needs. *hen you can focus on what=s really important, which for most people comes down to relationships with family and friends, taking care of your health, and doing what truly gives you meaning and purpose in life needs regarding food, shelter, sleep, property, and resources necessary for living

Steps in $etirement *lanning

5ecision retirement about the retirement age option. 1etting of financial goals 1aving of relevant amounts w.r.t. goals 'nvesting in appropriate modes .alculation of net worth Regular monitoring of financial plan and incorporate the necessary amendments in the plan.

Factors .ffecting $etirement *lanning

0ife style 8ersonal values >ature of income& salaried, business or professionalC stable (ob)non&stable (obC private (ob)government (ob >umber of years left for taking retirement 'nflation rate 8resent net worth of a person Risk appetite of a person 1ervices of a certified financial planner .onviction in the retirement planning effort 1eriousness M perseverance for retirement planning 0ife expectancy is the ma(or ruler of retirement planning. 7s per the 'ndian context, still the importance of retirement planning is not clearly identified. !ith the increasing life expectancy, high standards of living and high expectations for the upcoming future, pressure is building up for fund allocation, to meet up the needs of retirement. 0ong Jey factors to be evaluated while making out a retirement plan are present life style, income and capacity to save, family circumstances, level of inflation prevailing in the economy M the standard one would like to maintain at the time of post retirement 0ongevity of life expectancy has to be kept in mind while making out a retirement plan. Jey factors to be evaluated while making out a retirement plan are present life style, income and capacity to save, family circumstances, level of inflation prevailing in the economy M the standard one would like to maintain at the time of post retirement

,hat is Financial *lanningFinancial 8lanning is a critical use in ensuring your 0ong&*erm Financial 1ecurity in all possible ways, 'ndeed it=s a roadmap to achieve Financial Freedom in different stages of your life like /uying a #ome) .ar) 3ther Foals like planning a Hacation 7broad Emergency 2oney 8lanning .hild=s Education ) #igher Education 8lanning .hild=s 2arriage 8lanning Retirement 8lanning 8assing the .reated !ealth to the next Feneration. *here are some basic "uestions to answer for doing financial planning? !here you stand todayO !hat is your current financial situationO !here do you want to get toO !hat is your vision of your future financial situationO !ill you be able to get thereO #ow do you plan to achieve your visionO For a financial plan, you need to analyze your financial needs M goals here as mentioned above. 3ne should measure in terms of money that what resources one need to meet this stages of different goals and also the time period to achieve these goals. Finally, one has to write an action plan so that to fulfill the 8lan what products are useful to buy and savings to be done or increase)decrease in future too.

Financial planning &ourself3f course everyone canSbut (ust like you won=t cure your own disease on your own, you need to come to an expert for financial planning. 3therwise, without the right financial skills and tools for financial planning, your finances can end up as a disaster.

4our 'ife / 4our 5oals ,hat financial goals shoul" &ou e thin%ing a out7nything you want to do in your life can usually be "uantified in terms of the money that you will need to spend on the goal you wish to fulfill. 7ll goals have a financial value attached to them. For instance, if you want to buy a .ar, you can easily calculate whether it will cost you Rs. B lacs or Rs. 9; lacs. 1ome of the Financial Foals can be classified as .

Retirement 8lanning Education for children .hildren=s 2arriage Emergency Fund 8lanning /uying a house or a car of your own etc. 5epending on person to person we all have priorities that which goal is having highest importance and for that what to start saving to meet those entire goal on time. Financial conditions should be built on solid foundations. 3nce the basic needs are met one can start thinking about the goals for their changing lifestyle, this goals can be different from one to another as different people have different needs according to their lifestyle for them and their family so that its extremely personal. Examples of this goals can be ? /uying an 0.5 television /ig Hacation 7broad .reating your own Fym

$o.r Finan+ial Plan ) $o.

Need to ha4e tons o- mone, ? Financial 8lanning is the greatest thing that not many people think about even if it provides a high security of future M also it makes your life simpler. !e already knows that we can=t predict the future but its better if we plan it today. 7ll of us have something to plan it, not necessarily one have to be rich to plan it. Financial 8lanning is a peace of mind 1omeone has rightly said?& 'f you have dreams, you need a financial planN 't depends on how much effort you willing to put in for your financial plan, like in terms of Expenses, 'ncome M 7sset, 0iabilities too. /ut surely it re"uires lots more than the above which are, *he time you have to achieve the goal Risk taking capacity of individual >eed of emergency money 'ncreasing inflation

Need o- reg.lar in+ome 's this time is right for a financial planningO 1till many years remaining in my retirement planning, why to plan so earlyO *he best time to make your financial plan is *357E, as Financial 8lanning is a continuous process, as it remains in contact till the each goal is executed in proper way, 0ife has many uncertainties, if you start early you will have moretime left to make your money grow more, as we grow older our expense will rise and we may regret that time has passed. Wh, sho.ld ,o. do Finan+ial Planning reg.larl,? *imes are never constant, it changes so as our needs as we and our families grow old, the change in life style or may be change in inflation happens, some of the things are not in our hand such as inflation M purchasing power. 1o the old investment we have done will not make sense sometime in future as the inflation rises. 1ome examples of this ?& .hange in lifestyle .hange in family culture ) addition of a family member (o5 to Pre0are For Retirement When There6s "ittle Time "e-t !hat if retirement is (ust around the corner and you haven t saved enoughO #ere are some tips. 1ome are painful, but they ll help you toward your goal. 't s never too late to start. 't s only too late if you don t start at all. 1ock it away. 8ump everything you can into your tax&sheltered retirement plans and personal savings. *ry to put away at least ;- percent of your income. Reduce expenses. Funnel the savings into your nest egg. *ake a second (ob or work extra hours. 7im for higher returns. 5on t invest in anything you are uncomfortable with, but see if you can t s"ueeze out better returns. Retire later. Eou may not need to work full time beyond your planned retirement age. 8art time may be enough. Refine your goal. Eou may have to live a less expensive lifestyle in retirement. 5elay taking 1ocial 1ecurity. /enefits will be higher when you start taking them. 2ake use of your home. Rent out a room or move to a less expensive home and save the profits.

Ann.it, 7-inan+e theor,8

*he term annuity is used in finance theory to refer to any terminating stream of fixed payments over a specified period of time. *his usage is most commonly seen i

ndiscussions of finance, usually in connection with the valuation of the stream of payments, taking into account time value of money concepts such as interest rate and future value. Examples of annuities are regular deposits to a savings account, monthly home mortgage payments and monthly insurance payments. 7nnuities are classified by payment dates. *he payments $deposits% may be made weekly, monthly, "uarterly, yearly, or at any other interval of time.

Or"inar& annuit&
7n or"inar& annuit& $also referred as annuit&/imme"iate% is an annuity whose payments are made at the end of each period $e.g. a month, a year%. *he values of an ordinary annuity can be calculated through the following? V<W 0et? r X the yearly nominal interest rate. t X the number of years. m X the number of periods per year. i X the interest rate per period. n X the number of periods. >ote?

7lso let? 8 X the principal $or present value%. 1 X the future value of an annuity. R X the periodic payment in an annuity $the amortized payment%.

$ annuity notation% 7lso?

.learly, in the limit as n, increases

Other t&pes+
Fi0e" annuities / %hese are annuities $ith fixed payments. %hey are primarily used for lo$ risk in!estments like go!ernment securities or corporate bonds. ,ixed annuities offer a fixed rate but are not regulated by the &ecurities and Exchange #ommission. Varia le annuities / Unlike fixed annuities, these are regulated by the &E#. %hey allo$ you to in!est in portions of money markets. E6uit&/in"e0e" annuities / (ump sum payments are made to an insurance company.

,hat is annuit&- Ho! it is calculate"*he term annuity is used in finance theory to refer to any terminating stream of fixed payments over a specified period of time. *his usage is most commonly seen in discussions of finance, usually in connection with the valuation of the stream of payments, taking into account time value of money concepts such as interest rate and future value. Examples of annuities are regular deposits to a savings account, monthly home mortgage payments and monthly insurance payments. 7nnuities are classified by payment dates. *he payments $deposits% may be made weekly, monthly, "uarterly, yearly, or at any other interval of time. 7n ordinary annuity $also referred as annuity&immediate% is an annuity whose payments are made at the end of each period $e.g. a month, a year%. *he values of an ordinary annuity can be calculated through the following?V;W 7n annuity calculator can help you figure out the fixed payments you ll receive over time. *he calculator uses the initial principal balance, the interest rate received, and the length of the payment schedule period to calculate annuity payments . *he term annuity is used in finance theory to refer to any terminating stream of fixed payments over a specified period of time. *his usage is most commonly seen in discussions of finance, usually in connection with the valuation of the stream of payments, taking into account time val future value. Formula to .alulate the 8ayment 7mount of an 3rdinary 7nnuity 82* X FH$37% ) V$$9 R i%n & 9% ) i W where. Y FH$37%, or Future Halue of 3rdinary 7nnuity? the value of the annuity at time tXY 82*? 8ayment amount $value% of the individual payments in each period Y i? periodic interest rate that gets compounded for each period of time (periodic rate may be determined by dividing an annual rate by the number of periods in a year% Y n? number of periods $same as the number of payments) 'n finance theory, an annuity is an asset typically funded Kup&frontK with a lump sum that is managed to produce an income stream $often by underwriting insurance policies%... 'n practice, it is usually almost a scam, since annuities pay the vendor who sells them a huge commission $which is the reason they push them% and pay out at a far lower rate than the vending agency can earn by simply investing in common stocks $and pocketing the difference between what they earn and what they pay the annuity&holder%... 'f you are A:&years&old, 27E/E they make sense... ue of money concepts such as interest rate and future value.

,hat Does .nnuit& 2ean7 financial product sold by financial institutions that is designed to accept and grow funds from an individual and then, upon annuitization, pay out a stream of payments to the individual at a later point in time. 7nnuities are primarily used as a means of securing a steady cash flow for an individual during their retirement years. Investope"ia e0plains .nnuit& 7nnuities can be structured according to a wide array of details and factors, such as the duration of time that payments from the annuity can be guaranteed to continue. 7nnuities can be created so that, upon annuitization, payments will continue so long as either the annuitant or their spouse is alive. 7lternatively, annuities can be structured to pay out funds for a fixed amount of time, such as ;- years, regardless of how long the annuitant lives. 7nnuities can be structured to provide fixed periodic payments to the annuitant orvariable payments. *he intent of variable annuities is to allow the annuitant to receive greater payments if investments of the annuity fund do well and smaller payments if its investments do poorly. *his provides for a less stable cash flow than a fixed annuity, but allows the annuitant to reap the benefits of strong returns from their fund s investments. *he different ways in which annuities can be structured provide individuals seeking annuities the flexibility to construct an annuity contract that will best meet their needs.

Investing Outsi"e of Superannuation

5epending on your re"uirements for income and access to capital, you may choose to invest outside of the superannuation environment. Eou could choose to purchase investments such as property, managed funds or shares, or you could use your funds to pay off loans or to take a holiday. 7s part of this strategy, you may also choose to withdraw your funds from superannuation. #owever, you need to be aware that you may be liable to pay lump sum tax on any amounts you withdraw. Factors to be aware of? Fenerating income from investments held outside the superannuation environment may not be the most tax effective option for you. 'f you make a lump sum withdrawal from superannuation to invest into non& superannuation investments, you may lose access to tax&free income) earnings or the tax offset that is generally associated with income streams that are commenced with superannuation benefits. 'f you make a lump sum withdrawal from superannuation to invest into non& superannuation investments, you may lose the opportunity to reinvest your funds into the superannuation environment at a later date. 'nvesting outside superannuation may impact on any current or future .entre link benefits which you may be eligible for.

Superannuation 7 Ta0e" an" Unta0e" Fun"s

2ost superannuation funds are taxed funds, meaning that earnings within the fund are taxed. *his includes public offer funds, industry funds and self managed superannuation funds. 1ome funds however are untaxed and different taxation rules apply for these funds, particularly when taking a benefit as a lump sum or an income stream. Examples of untaxed funds include the .ommonwealth superannuation scheme, 1uper 17, and FE1/. 8articular advice would need to be sought in relation to funds such as these

Social structure
arrangements which form the society as a whole, and which determine, to some varying degree, the actions of the individuals socialized into that structure. *he meaning of Ksocial structureK differs between various fields of sociology. 3n the macro scale, it can refer to the system of socioeconomic stratification $e.g., the class structure%, social institutions, or, other patterned relations between large social groups. 3n the meso scale, it can refer to the structure of social network ties between individuals or organizations. 3n the micro scale, it can refer to the way norms shape the behavior of actors within the social system. *hese meanings are not always kept separate. For example, recent scholarship by 6ohn 0evi 2artin has theorized that certain macro&scale structures are the emergent properties of micro&scale cultural institutions $this meaning of KstructureK resembles that used by anthropologist .laude 0Zvi&1trauss%. 2arxist sociology also has a history of mixing different meanings of social structure, though it has done so by simply treating the cultural aspects of social structure as epiphenomena of its economic ones. 1ince the 9:<-s, the term has been in general use in social science , especially as a variable whose sub&components needed to be distinguished in relationship to other sociological variables.

Social structure is a term used in the social sciences to refer to patterned social

Overvie!
*he notion of social structure as relationships between different entities or groups or as enduring and relatively stable patterns of relationship emphasises the idea that society is grouped into structurally related groups or sets of roles, with different functions, meanings or purposes. 3ne example of social structure is the idea of Ksocial stratificationK, which refers to the idea that society is separated into different strata $levels%, guided $if only partially% by the underlying structures in the social system. *his approach has been important in the academic literature with the rise of various forms of structuralism. 't is important in the modern study of organizations, because an organization s structure may determine its flexibility, capacity to change, and many other factors. *herefore, structure is an important issue for management. 1ocial structure may be seen to influence important social systems including the economic system, legal system, political system, cultural system, and others. Family, religion, law, economy and class are all social structures. *he Ksocial systemK is the parent system of those

Societ&+ self contained, self sufficient population united by social relationships, bounded from other populations by geographic locations. stratification: une"ual distribution of valued goods or holdings in a population $i.e. class,

status, resources, grades, wealth, positional goods, etc.%

3et!or%+ pattern of relationships in a population of actors

1ocial structure variables? pattern of relationships, size of institution, income distribution, and concurrency of social relationships

Definitions an" concepts

7s noted above, social structure has been identified as '. ''. '''. the relationship of definite entities or groups to each other, enduring patterns of behavior by participants in a social system in relation to each other, and institutionalized norms or cognitive frameworks that structure the actions of actors in the social system.

0opez and 1cott $;---% distinguish between institutional structure and relational structure, where in the former? T ...social structure is seen as comprising those cultural or normative patterns that define the expectations of agents hold about each other s behavior andthat organize their enduring relations with each other. $p. <% U whereas in the latter? T ...social structure is seen as comprising the relationships themselves, understood as patterns of causal interconnection and interdependence among agents and their actions, as well as the positions that they occupy. $p. <% 1ocial structure can also be divided into microstructure and macrostructure. 2icrostructure is the pattern of relations between most basic elements of social life, that cannot be further divided and have no social structure of their own $for example, pattern of relations between individuals in a group composed of individuals & where individuals have no social structure, or a structure of organizations as a pattern of relations between social positions or social roles, where those positions and roles have no structure by themselves%. 2acrostructure is thus a kind of second level structure, a pattern of relations between ob(ects that have their own structure $for example, a political social structure between political parties, as political parties have their own social structure%. 1ome types of social structures that modern sociologist differentiate are relation structures $in family or larger family&like clan structures%, communication structures $how information is passed in organizations% and sociometric structures $structures of sympathy, antipathy and indifference in organizations .

9 1ocial rule system theory reduces the structures of $<% to particular rule system arrangements, that is, the types of basic structures of $9 and ;%. 't shares with role theory, organizational and institutional sociology, and network analysis the concern with structural properties and developments and at the same time provides detailed conceptual tools needed to generate interesting, fruitful propositions and models and analyses. 1ociologists also distinguish between. normative structure Q pattern of relations in given structure $organisation% between norms and modes of operations of people of varying social positions ideal structure Q pattern of relations between beliefs and views of people of varying social positions interest structure Q pattern of relations between goals and desires of people of varying social positions interaction structure Q forms of communications of people of varying social positions

Elements of Social Structure

'n order to discuss the basic division and types of social structures, the KunitK of social structure should be established first. 2urdoch $Foldsmith 9:,A% has shown that the family is universal among stable societies and thus should be regarded as the KunitK of social structure. .ulture, as the product of the interactions in society, both material $between people and physical ob(ects% and non&material $in relation to meanings, beliefs, language, values, ideas, expectations, etc.% is shared, learned, and intergenerational. 't also forms the foundation of social structure. 1ociety is grouped into structures with different functions, meanings, or purposes. 'n a broader sense is the Ksocial system,K which can be viewed as a social structure composed of the economic system, legal system, political system, and cultural system $some sort of shared reality? language, norms, values, etc.%. 1ocial structure, however, is much more than that. 't also includes education, family, religion, and social services such as health care. 0anguage is the basic channel for communicating information and instruction in a society. *here are cultural norms affecting marriage, child bearing, and child rearing. 8olitical systems affect not only the individual political environment but also certain legal systems, regulation of violence $by a police force%, property laws, trade rules, health care, and so forth. 1ocieties also generally develop an agreed upon division of labor. *hese different elements are interrelated, as can be seen from the following example? economic factors have been responsible for shifts in popular behavior, some of them cutting across class lines. 7s a result of increasing production, prosperity increased, and the general trend in the standard of living for most groups was upward, allowing ordinary people to improve their diet, housing, and increase leisure time. !orkers pressed for a workday of 9; hours, then ten, and, in the early twentieth century, a few groups began to demand an even shorter period. 1cattered vacation days were also introduced, and the@English weekend, Twhich allowed time off on 1aturday afternoons as well as 1undays, spread widelyU.

.mong the several elements of social an" cultural structures8 t!o are of great importance?
*he first consists of culturally defined goals, purposes, and interests, held out as legitimate ob(ectives for all members of the society. *hey are simply the things @worth striving for. 7lthough some of these cultural goals may be directly related to human biological needs, they are not necessarily determined by them. *he second element of the cultural structure defines, regulates, and controls the acceptable ways of reaching these goals. Every social group invariably matches its cultural ob(ectives with regulations, rooted in the norms and values, regarding allowable procedures for moving toward these ob(ectives.

Fenerally, no society lacks norms governing conduct. #owever, societies do differ in the degree to which acceptable behavior, social mores, and institutional controls are effectively integrated with the goals in the hierarchy of cultural values. *he social structure remains intact as long as members of the society are able to achieve their goals within the framework of acceptable ways of reaching them. !hen cultural values and social structure become incompatible, changes in the social structure become inevitable.

*ension *lan
,hat Does *ension *lan 2ean7 type of retirement plan, usually tax exempt, wherein an employer makes contributions toward a pool of funds set aside for an employee s future benefit. *he pool of funds is then invested on the employee s behalf, allowing the employee to receive benefits upon retirement.

Investope"ia e0plains *ension *lan

'n his or her current income stream toward retirement income. *here are two main types of pension plans? defined&benefit plans and defined&contribution plans. 'n a defined&benefit plan, the employer guarantees that the employee will receive a definite amount of benefit upon retirement, regardless of the performance of the underlying investment pool. 'n a defined& contribution plan the employer makes predefined contributions for the employee, but the final amount of benefit received by the employee depends on the investment s performance.

Investope"ia e0plains Define"/Benefit *lan

*his fund is different from many pension funds where payouts are some what dependent on thereturn of the invested funds. *herefore, employers will need to dip into the companies earnings in the event that the returns from the investments devoted tofunding the employee s retirement result in a funding shortfall. *he payouts made toretiring employees participating in defined&benefit plans are determined by morepersonalized factors, like length of employment. 7 tax&"ualified benefit plan, shares thesame characteristics of a defined&benefit plan, but also provides the beneficiary of theplan with added tax incentives. *hese tax incentives are not realized under non&"ualified plans.

,hat Does the En" of Define" Benefits 2ean for Emplo&ees-

*he entire scenario is bad news for employees. 4nlike a defined&benefit plan, where the employee knows exactly what his or her benefits will be upon retirement, the only certainty in a defined&contribution plan is the amount that the employee contributes. 7fter the money hits the account, it s up to the vagaries of the stock market to determine the ultimate outcome. 2aybe the markets will go up, and maybe they won t. 1upporters of this shift in responsibility for retirement planning argue that investors can choose KsafeK investments, such as money market funds or 4.1. *reasury bonds. #owever, according to the 6anuary ;,, ;--G edition of Fund Fire, experts have noted that the average worker would likely have to invest 9;L of his or her pretax income in order to have any hope of generating the type of returns formerly offered 2arket 2utual Funds and our 2oney 2arket tutorial.% !orkers who cannot afford to invest such a high percentage of their salaries need to rely on the stock market to make up the difference. 3n the other hand, many employees who were relying on their employer&funded plans were left to fend for themselves when their employers failed to fund the plans. 1imilarly, many employees were left in a bind when their employers terminated defined&benefit plans or downsized their staff, giving the workers a one&time, lump&sum payout instead of a steady income stream..

The 3e! $ealit& of $etirement

*homas 6. 2ackell 6r., .hairman of the /oard of the Federal Reserve /ank of Richmond, gave a speech in >ew Eork at the end of 6anuary ;--G in which he announced that he anticipates that defined&benefit plans will fade away over the next five years.

*ension *rotection .ct

.ongress passed the 8ension 8rotection 7ct of ;--G $887% in 5ecember ;--+, which made significant changes for defined&benefit plans. *hese include stricter funding re"uirements, making it harder for employers to terminate plans that are not fully funded.

Commencing a *ension
*he information below may not apply to certain funds $as detailed above%. Eour adviser will be able to assist with further information if the information below does not apply to your circumstances. *he Federal Fovernment encourages retirees to provide their own income in retirement, rather than relying solely on the 7ge 8ension. /y providing incentives in the form of tax concessions and social security benefits, the Fovernment helps to make investments that produce regular income streams more attractive to retirees. *he main type of income stream available in today=s market is a superannuation pension.

,hat is a *ension7 superannuation pension is a retirement income stream that can only be purchased with money held in superannuation. !ith this type of investment all earnings generated are reinvested back into the account. Regular income payments are paid until the account balance is exhausted. Furthermore, any earnings generated or capital gains in the account are not sub(ect to tax. *he benefit of a 8ension is that income payments are both tax effective and concession ally treated under the social security income test.

*ension Features

Eou receive a flexible D income stream in which you are able to choose the amount of income you receive sub(ect to minimum payment percentages set by the Fovernment, no maximum will apply $with the exception of pensions commenced under the transition to retirement condition of release, which will have a maximum payment amount of the account balance each year%. *he minimum amount of your pension is the account balance multiplied by the percentage factor. Eou are able to choose the payment term i.e., monthly, "uarterly, half&yearly and annually.

'ncome payments may be concession ally taxed, refer to the *axation of 1uperannuation 8ensions section for further details. Earnings on assets supporting these pensions will be tax exempt. .apital gains on assets supporting pensions are reduced to zero. Eou are able to access your capital funds at any time, with the exception of pensions commenced under the transition to retirement condition of release. 7s a result, you have the flexibility to make withdrawals in addition to your income payments. Eou are generally able to choose from a number of different investment options from which your pension payments will be drawn. *his gives you some control over where and how your money is invested. Eour investment will receive favorable 1ocial 1ecurity treatment under the income test which could potentially improve your eligibility for .entre link benefits. *here is no mortality risk, which means that if you die before the capital invested $plus any investment earnings% is exhausted, the balance will be paid out to your nominated beneficiary, your estate, or legal representative. 'f, upon death, the account balance is paid to a dependant, such as a spouse or a child under 9A years of age, the lump sum will usually be paid tax&free.

Factors to e a!are of+

D *he term of the pension is not guaranteed which means your money may not last throughout your retirement. D Eour investment returns will fluctuate depending on economic and market conditions which means your investment can increase or decrease in value. D *he amount of income you withdraw must be sub(ect to the prescribed minimum limits, no maximum will apply with the exception of pensions commenced under the transition to retirement condition of release. D For those under G-, lump sum withdrawals from a pension taken on top of regular payments may incur tax.

*ax may be levied on any remaining pension balance on death $for example, if paid as a lump sum to a non&financially dependant beneficiary, such as an adult child%.Ta0ation of

Superannuation *ensions
When you receive an income payment from either a new or existing superannuation pension you may incur tax, depending on your age and the components of your pension.

Ta0ation of Superannuation *ensions 9note this applies onl& to ta0e" fun"s:

>ew superannuation pension accounts may include both tax&free and taxable components. Each income payment $and commutation amount% from a superannuation pension will be deemed to include both taxable and tax free components and is based on the fixed percentage of these components at the commencement of the superannuation pension. *his means that you cannot choose which component$s% to draw your pension from. *his regime came into effect on 9 6uly ;--, and is known as the proportional drawdown regime. 'ncome payments for those aged Gand over are entirely tax&free. For those aged ++ to +:, the *ax free component of the income payment is free of 87EF tax and a tax offset may apply to the remainder $taxable portion% of the pension payment, enhancing the tax efficiency of the income stream.

Ta0ation of E0isting *ensions

8rior to 9 6uly ;--,, pensions may have attracted a tax free amount $previously known as the deductible amount%, based on the previous components such as the unreduced component. 7ll income payments were taxable at marginal tax rates less any deductible amount. 'n some instances, tax offsets applied, which further enhanced the tax efficiency of these payments. *he tax free amount was calculated by dividing the tax exempt components $usually the un deducted component% by the relevant number $usually the life expectancy%. 'ndividuals under G- will retain the existing [deductible amount= status for pensions already in force as at 9 6uly ;--, and will continue to receive the same tax&free amount each year up to age G-, unless a trigger event has occurred. Trigger E4ents Existing pensions will be converted to the proportional drawdown approach when one of the following [trigger events= occurs? Eou are aged G- or D over at 9 6uly ;--, $with the fixed percentages calculated as if you had received a benefit payment (ust before 9 6uly ;--,% D Eou reach age GD Eour pension is wholly or partially commuted D Eou die and the pension is continued by a dependant beneficiary, or a death benefit is paid as a lump sum to a non&tax dependant or your estate 3nce a trigger event has occurred, the fixed percentage of the tax free component will be based on any unused un deducted purchase price.

*resent Scenario of $etirement

The 5eneration 5ap
*he words KretirementK and Kbaby boomersK are forever linked. *he boomers are living longer, retiring earlier and en(oying more active golden years than any previous generation. 4nfortunately, according to recent studies by #ewitt 7ssociates 00. and the .enter for Retirement Research at /oston .ollege, the generations that follow them aren t faring as well in the retirement savings department. !e ll present the data on retirement savings for Fenerations \ and E and explain why the younger generations need to save even more than their parents.

The Changing Face of $etirement

!hile boomers $aged B; to +:% often have pension checks to supplement their 1ocial 1ecurity income, future generations aren t so lucky. Employer&sponsored defined&benefits plans are on the road to extinction as employers replace them with defined contribution plans. 1ocial 1ecurity is pro(ected to replace a smaller and smaller portion of retirement income for each succeeding generation. *he 1ocial 1ecurity 7dministration notes that by ;-B9, K*here will be enough money to pay only about ]-.,B for each dollar of scheduled benefits.K !hen the entity that sends out the checks warns that it is going to run out of money, younger workers should be maximizing the amount they contribute to defined contribution plans & unfortunately, this isn t what s happening.

5eneration ; an" 4 are Falling Behin" in Savings

7mong workers aged ;G to B9, <,L do not participate in an employer&sponsored retirement savings plan, according to a ;--G report released by #ewitt 7ssociates. *he report further notes, that without any B-9$k% plan savings, these workers can expect their retirement incomes to replace (ust BBL of the income they earned during their working years. Even those who do save don t save enough. *he .enter for Retirement Research at /oston .ollege cites B:L of the members of Feneration \ are Kat riskK of reaching retirement without having enough money to actually retire. #ewitt 7ssociates notes that buying a house and paying for children are commonly cited as greater priorities than saving for retirement. !hen it comes to retirement planning, the generation characterized by youthful ambition hasn t grown up yet. 7mong people aged 9A to ;+, G:L of eligible employees do not participate in an employer&sponsored retirement savings plan according to #ewitt 7ssociates. 'nterestingly enough, this means that the number of Feneration E members that don t participate in employer&sponsored plans is nearly e"ual to the number of Feneration \ers that do. !hile the lack of knowledge about investing is fre"uently cited as the reason for not saving, it s a problem that should be easy to fix for a generation characterized as tech&savvy and having a futuristic mindset. *he internet provides easy access to a virtual library filled with information about how and why to save for the future.

Ho! to 2a%e E0pectations an" $ealit& 2eet

5espite their failure to save, both Fenerations \ and E have high hopes for the power of investments to save the day when it comes to retirement. #ewitt reports that :<L of Feneration \ and :;L of Feneration E expect their B-9$k% plans to provide income for retirement. 'n order to make these hopes a reality, contribution rates to B-9$k% plans need to (ump significantly. 7ccording to #ewitt 7ssociates, Feneration \ers contribute an average of ,.;L of their pre&tax salary to employer&sponsored savings plans and members of Feneration E contribute (ust +.GL. /oomers, on the other hand, put away A.<L of their salaries. 5espite the low savings rates, members of Fenerations \ and E still have time to act. 2embers of Feneration \ that do contribute to their employer&sponsored retirement savings plan can increase the amount of expected income during retirement to :+.,L of what they earned during their workings years, according to the #ewitt study. 2embers of Feneration E can do even better, as they have more time to save. Regardless of your generation, if you aren t already nearing retirement age and covered by a pension plan, the burden of saving for your future is likely to fall s"uarely on your own shoulders. Rather than ignore it and hope for the best, the time to plan and act is now. *o get started, find out whether your employer offers a B-9$k% program and whether or not the company matches employer contributions. 'f there is a match retirement savings program in place, you can start to save for your future by contributing at least enough to earn that match. !ith many plans, a GL contribution earns a <L match. *hat s a +-L return on your investment even if the investment you select never increases in value. 3nce you re getting the match, increase your contribution rate each year when you get a raise. /efore long, you ll be on your way to building a nice nest egg. 'f your employer does not offer a B-9$k% plan, it s time to open up an individual retirement account $'R7%. !hile you won t earn a company match in your 'R7, you will still get the benefit of tax&deferred growth. Regardless of whether you save in a B-9$k% plan or an 'R7, the important thing is that you save.

Intro"uction To Social Securit&

1ocial 1ecurity is a federal benefits program the 4nited 1tates developed in 9:<+. !hile the program encompasses disability income, veterans pensions, public housing and even the food stamp program, it is most commonly associated with retirement benefits. #owever, if you still have many working years ahead of you, you may not be able to depend on these benefits as a source of income. 'n this article, we go over how the 1ocial 1ecurity system works and why it is predicted to fail in the future. *he 1ocial 1ecurity system is funded through payroll taxes. *he Federal 'nsurance .ontributions 7ct $F'.7% mandates a 9;.BL levy on the first ]9-G,A-- $;-9limit% of each individual s earned income each year. *he employer pays G.;L and the employee pays G.;L. 1elf&employed individuals pay the full 9;.BL..ontrary to popular belief, this money is not put in trust for the individual employees who are paying into the system, but is used to pay existing retirees. 7ny excess is invested in 4.1. *reasury bonds..$easons to Ta%e Social

Securit& Earl&
*he most common reasons that people opt to take their 1ocial 1ecurity benefits early include? D 't is the only way they can afford to retire. D D D *hey have a short life expectancy. *hey can receive a better return on the money by investing it themselves. *hey want to get something from the system before it goes bankrupt.

$easons to Dela& 4our Benefits

/esides the fact that you ll receive a higher income by waiting until full retirement age or later, there are two other points to consider. S.r4i4or Needs 1urvivor benefits are based on the original 1ocial 1ecurity recipient s benefit. .onse"uently, if your spouse is expected to live a long time, taking reduced benefits could affect his or her income long after you die. In+ome Ta/es *ax planning is an important segment of retirement planning, but some people may not realize that 1ocial 1ecurity income could be taxable. *o determine whether any of your benefits will be taxable, take half of your pro(ected 1ocial 1ecurity plus all your income from other sources, including tax&exempt interest. 'f you are married and file a (oint return, you must combine your incomes and your 1ocial 1ecurity.

Still Can<t Deci"e1uppose that you know you should hold off taking 1ocial 1ecurity, but you still like the idea of a steady, monthly income. 3ne strategy could be to delay the benefits and buy a term& certain, fixed immediate annuity. Eou ll get an income that s guaranteed by the issuing insurance company to make up for the missed 1ocial 1ecurity checks. *hen, when you turn ,-, the annuity payments will stop and the 1ocial 1ecurity payments will begin. #owever, because 1ocial 1ecurity might have cost of living ad(ustments $.307%, you may want to include an inflation rider within the annuity. *hat way you ll receive an annual increase in your annuity payments.

.ll Things Consi"ere"

/efore you make a decision as to when to begin your 1ocial 1ecurity retirement income, there are few things you should consider. *hese include your?

D D D D D

#ealth *ax status 1urvivors needs Future income needs .urrent income needs

7lthough 1ocial 1ecurity was never meant to be a full replacement for your pre&retirement income, it can play an important part in your retirement planning and you should try to use it to your full advantage whether you retire early or not.

$etire In St&le
7s much as you may love your (ob, perhaps you d rather be living out your retirement fantasies & like sipping highballs with 0atin&sounding names while putting for a "uadruple bogey on a golf course in Fuam, for example. 7nd as great as your (ob may be & what with the "uestionable workspace, the battery acid coffee and the arcane orders from the top & you were not meant to work until deathN 'n this article, we ll show you how to plan for the end of your working years so that you can live them out in style. Retirement often is seen as the reward for a lifetime of labor. #owever, this freedom after years of servitude is not guaranteed. 't is an unfair reality that, even late in life, you must look after your own affairs. 7fter all, no one else will. *o make the goal of retirement $or early retirement% anything more than an ethereal dream, you must not only plan for it, but your plan must be sound and it must be followed.

$etirement *lanning+ Buil"ing . 3est Egg

*here are a myriad of investment accounts, savings plans and financial products you can use to build your retirement nest egg. 2any countries have government&sanctioned retirement accounts that provide for tax&deferral while your savings are growing in the account, thus postponing taxation of your investment earnings until you withdraw your funds for retirement. 5ue to the wide array of savings methods available $each with their own pros and cons% and the fact that each individual will have a different solution based on his or her circumstances and personal preferences, it would be impractical to discuss each in detail. *hat said, there are financial goals and strategies common to pretty much everyone, and a core group of investment vehicles available to most as well. 7 "uick overview of the tools at your disposal and the characteristics of each will help you determine what route is best for you. 'f you feel you need assistance choosing the financial vehicles with which to build your nest egg, consider consulting with a professional financial planner.

5overnment/Sponsore" Vehicles
2ost governments of developed countries provide a legal framework for individuals to build retirement savings with tax&saving advantages. 5ue to the advantages these investment accounts offer, there are usually limits regarding contribution amounts and age limits at which you will stop en(oying the benefits of those savings plans. 't s generally advisable for you to exhaust the contribution room you have for your government&sponsored accounts before you begin looking at other avenues, as whatever securities you invest in are more likely to deliver enhanced returns through compounding of tax&sheltered earnings or otherwise beneficial accounts.

$etirement *lanning+ ,here ,ill 2& 2one& Come From>ow that we ve outlined how to calculate the money you ll need for retirement, we need to figure our where that money will come from. !hile employment income seems like the obvious answer, there are actually many sources of funds you can potentially access to build your retirement nest egg. 3nce you lay them all out clearly, you can then determine how much money you ll need to save every month in order to reach your retirement goals. *here are typically several sources of retirement savings for the average individual. *hese include the following. :# Emplo&ment Income 7s you progress through your working life, your annual employment income will probably be the largest source of incoming funds you receive & and the largest component of your contributions to your retirement fund. For your retirement plan, simply write down what your after&tax annual income is. *hen subtract your annual living expenses. *he amount left over represents the discretionary savings you have at your disposal. 5epending upon how the numbers work out, you may be able to save a large portion of your employment income toward your retirement, or you may only be able to save a little. /e sure to use a budget and include all your recurring expenses. 3ne way to ensure you save the pro(ected amount for retirement is to treat the amount you plan to save as a recurring expense. ;# Social Securit&

7s we mentioned earlier, social security benefits can provide a small portion of your retirement income. , you can estimate your retirement benefits $in today s dollars% by using the site s online calculator. Eou may not want to include social security benefits in your retirement calculations because, as we already mentioned, the entire pro(ected amount may not be available at retirement time. 7lternatively, you may wish to include them at a portion of their value, say +-L, to be on the conservative side. Either way, figure out what your estimated social security benefits are expected to be in today s dollars and add them to your list of retirement income sources. Eou won t be able to use this money to build your nest egg, but it will help to fund your living expenses when you re retired and reduce the size of nest egg you will need .

=# Emplo&er/Sponsore" $etirement *lan

Eou may or may not participate in a retirement plan through your employer. 'f you don t, you will need to focus on your other income sources to fund your retirement. 'f you do participate in an employer plan, contact your plan provider and obtain an estimate of the fund s value upon your retirement. Eour plan provider should be able to give you an estimated value $in today s dollars% of your retirement funds in terms of a monthly allowance. 3btain this number and add it to your list of retirement income sources. 1imilar to your social security benefits, the funds from your employer plan can help cover your living expenses during your retirement. #owever, most employer plans have rules regarding the age at which you can start receiving payments. Even if you "uit working for your company at age +-, for example, your employer plan may not allow you to begin receiving payments until age G+. 3r they may allow you to begin receiving payments early, but with a penalty that reduces the monthly payment you receive. *alk to your plan provider to determine what rules apply to your employer plan and consider them when you are making your retirement plan.

># Current Savings an" Investments

7lso consider what current savings and investments you have. 'f you already have a sizable investment portfolio, it may be sufficient to cover your retirement needs all by itself. 'f you have yet to begin saving for your retirement or are coming into the retirement planning game late, you will need to compensate for your lack of current savings with greater ongoing contributions.

(# Other Sources of Fun"s

Eou may have other sources that will be available to fund your retirement needs. 8erhaps you will receive an inheritance from your parents before you reach retirement age or have assets, such as real estate, that you plan to sell before retiring. !hatever additional sources of funds you do happen to have, be sure to include them in your retirement pro(ections only if they are certain to occur. Eou may be expecting to realize a large inheritance from your parents, but they may have other plans for their surplus savings, such as donating them to charity. 3ther unexpected

cash inflows may also come along as you build toward your retirement, such as lottery winnings, gifts, raises or bonuses, etc. !hen you do happen to receive these additional cash inflows, consider adding them to your retirement fund. 't s also fine to include the planned sale of real estate to when you estimate your retirement funds $at a conservative price%.

$etirement *lanning+ .sset .llocation .n" Diversification

.sset .llocation+
1o far, we ve gone through how to determine what you ll need for retirement, where you can get your retirement savings from, what types of investment accounts you can put your savings into and the benefits of long&term and tax&efficient investing. 7fter all this you may now be asking yourself, K!hat the heck do ' invest inOK't isn t practical to discuss in detail the wide array of securities and investing strategies available in the market today, but we will go over the basics you ll need to know to set up your retirement investments. 'f you feel you need assistance understanding and selecting securities to invest in, consider seeking the help of a professional financial planner. *he assets you choose to invest in will vary depending on several factors, primarily your risk tolerance and investment time horizon. *he two factors work hand in hand. *he more years you have left until retirement, the higher your risk tolerance. 'f you have a longer&term time horizon, say <- years or more until retirement, investing all of your savings into common stocks is probably a reasonable idea. 'f you are nearing your retirement age and only have a few years left, however, you probably don t want all of your funds invested in the stock market. 7 downturn in the market a year before you are all set to cash out could put a serious damper on your retirement hopes. 7s you get closer to retirement, your risk tolerance usually decreasesC therefore, it makes sense to perform fre"uent reassessments of your portfolio and make any necessary changes to your asset allocation. Fenerally speaking, if you have a limited time horizon, you should stick with large&cap, blue chip stocks, dividend&paying stocks, high& "uality bonds, or even virtually risk&free short&term *reasury bills, also called *&bills. *hat said, even if you have a long&term time horizon, owning a portfolio of risky growth stocks is not an ideal scenario if you re not able to handle the ups and downs of the stock market. 1ome people have no problem picking up the morning paper to find out their stock has tanked 9- or ;-L since last night, but many others do. *he key is to find out what level of risk and volatility you are willing to handle and allocate your assets accordingly. 3f course, personal preferences are second to the financial realities of your investment plan. 'f you are getting into the retirement game late, or are saving a large portion of your monthly income (ust to build a modest retirement fund, you probably don t want to be betting your savings on high&risk stocks. 3n the other hand, if you have a substantial company pension plan waiting in the wings, maybe you can afford to take on a bit more investment risk than you otherwise would, since substantial investment losses won t derail your retirement.

7s you progress toward retirement and eventually reach it, your asset allocation needs will change. *he closer you get to retirement, the less tolerance you ll have for risk and the more concerned you ll become about keeping your principal safe. 3nce you ultimately reach retirement, you ll need to shift your asset allocation away from growth securities and toward income&generating securities, such as dividend&paying stocks, high&"uality bonds and *& bills.The Importance of Diversification *here are countless investment books that have been written on the virtues of diversification, how to best achieve it and even ways in which it can hinder your returns. 5iversification can be summed in one phrase? 5on t put all of your eggs in one basket. 't s really that simple. Regardless of what type of investments you choose to buy & whether they are stocks, bonds, or real estate & don t bet your retirement on one single asset. 7s you contribute savings to your retirement fund month after month, year after year, the last thing you want is for all your savings to be wiped out by the next Enron. 7nd if there s anything we have learned from the Enrons and !orldcoms of the world, it s that even the best financial analysts can t predict each and every financial problem. Fiven this reality, you absolutely must diversify your investments. 5oing so isn t really that difficult, and the financial markets have developed many ways to achieve diversification, even if you have only a small amount of money to invest.

.ctive Vs# *assive 2anagement

.onsider buying mutual funds or exchange&traded funds $E*Fs%, if you are starting out with a small amount of capital, or if you aren t comfortable with picking your own investments. /oth types of investments work on the same principle & many investors funds are pooled together and the fund managers invest all the money in a diversified basket of investments. *his can be really useful if you have only a small amount of money to start investing with. 't s not really possible to take ]9,---, for example, and buy a diversified basket of ;- stocks, since the commission fees for the ;- buy and ;- sell orders would ruin your returns. /ut with a mutual fund or E*F, you can simply contribute a small amount of money and own a tiny piece of each of the stocks owned by the fund. 'n this way, you can achieve a good level of diversification with very little cost. *here are many different types of mutual funds and E*Fs, but there are two basic avenues you can choose? active management and passive management. 7ctive management refers to fund managers actively picking stocks and making buy and sell decisions in attempt to reap the highest returns possible 8assive management, on the other hand, simply invests in an index that measures the overall stock market, such as the 1M8 +--. 'n this arrangement, stocks are only bought when they are added to the index and sold when they are removed from the index. 'n this way, passively managed index funds mirror the index they are based on, and since indexes such as the 1M8 +-essentially are the overall stock market, you can invest in the overall stock market over the long term by simply buying and holding shares in an index fund. 'f you do have a sizable amount of money with which to begin your retirement fund and are comfortable picking your own investments, you could realistically build your own diversified portfolio. For example, if you wanted to invest your retirement fund in stocks, you could buy about ;- stocks, a few from each economic sector. 8rovided none of the companies in your portfolio are related, you should have a good level of diversification. *he bottom line is, no matter how you choose to diversify your

retirementholdings, make sure that they are properly diversified. *here is no exact consensus on what number of stocks in a portfolio is re"uired for ade"uate diversification, but the number is most likely greater than 9-, and going to ;- or even a bit higher isn t going to hurt you.

$etirement *lanning+ Conclusion

!hile it s impossible to learn everything you ll ever need to know about retirement planning in a single tutorial, the ground we ve covered here should give you a solid start. Retirement planning is an ongoing, lifelong process that takes decades of commitment in order to receive the final payoff. *he idea of accumulating hundreds of thousands of dollars in a retirement nest egg certainly can seem intimidating, but as we outlined in this tutorial, with a few basic calculations and commitment to a feasible plan, it s not difficult to achieve.

'et<s go over !hat !e<ve covere"+

D D D D 7s a result of an increasingly aging population, governments may be forced to suspend social security benefits in the future. *he responsibility for financing retirement is being transferred to individuals. #ow much money you ll need to save for retirement will depend on your desired standard of living, your expenses and your target retirement age. *o determine the size of nest egg, you ll need to? 9% 5ecide the age at which you want to retire. ;% 5ecide the annual income you ll need for your retirement years. <% 7dd up the current market value of all your savings and investments. B% 5etermine a realistic real rate of return for your investments. +% 3btain an estimate of the value of your company pension plan. G% Estimate the value of your social security benefits. 7ssume that an annual inflation rate of BL will erode the value of your investments and ad(ust your savings plan accordingly to provide yourself with a margin of safety. 'ncome during retirement may come from the following sources? 9% employment income, ;% social security, <% employer&sponsored retirement plans, B% savings and investments, +% other sources of funds, including inheritance money, prizes and lottery winnings, gifts, raises, bonuses and real estate. *here are several investment options that can be used to achieve your retirement savings goals. *hese include, but are not limited to, governments&sponsored vehicles $'R7s, B-9$k%s, RR18s etc.%, company pension plans, other products such as annuities and life insurance. /eginning to save for retirement at an early age is one of the biggest factors in ensuring success. *he power of compounding also works with taxes & using tax&deferred investment

D D

D D

vehicles can help you to maximize your rate of savings. D D D 7sset allocation is a key factor in building any successful portfolio. *he assets you choose will depend on your risk tolerance and investment time horizon. 5iversification will help you to reduce the amount of risk in your portfolio, increasing the chances that you ll reach your retirement savings goals. 2ake saving a priority by setting up automatic payments from your checking account to your retirement savings account, make the maximum salary deferral contribution to your employer&sponsored retirement plan and work aggressively to pay down large debts that can reduce your saving rate. 2ake a household budget to ensure that you are contributing as much as possible to saving for retirement and aim to reduce unnecessary expenses.

$ESE.$CH 2ETHODO'O54
$esearch Strateg&
D For my research study first of all this is very important that ' have to know what is retirement planning and how it works.

Collection of "ata *rimar& Source 7 Sampling Design

a) 8opulation? 8opulation included investors. b% 1ample frame? 1ince the data was collected through personal contacts, the sample frame was the individuals who are investing in life insurance policies and retirement plans .

Sampling elements+
'ndividual respondents were the sampling elements.

Sampling Techni6ues+
8urposive sampling techni"ue was used to select the samples.

Sample Si?e+
1ample size was 9+- respondents

Secon"ar& Source
*he common source for secondary data includes different websites M books and

.3.'4SIS 1 I3TE$*$ET.TIO3
Q.1. Respondent age group?
18-25 25-35 35-45 45-60 40% 25% 18% 17%
18-25 25-35 35-

17%

40% 18%

25%

INTERPRETATION

From the above data shows that 40% of the respondents are of age between 18-25; 25% are 25-35 ;18% are 35-45 and are 17% above 45.

Q.2. Respondents profession ?

erv!"eman #$s!nessman %rofess!ona&s 'thers 25% 20% 15% 40%

40% 35% 30% 25% 20% 15% 10% 5% 0% erv!"eman #$s!nessman %rofess!ona&s 'thers

INTERPRETATION
(he above f!g$re shows that most&) peop&es are serv!"eman and after that both b$s!nessman

* profess!ona&s and &ast others respe"t!ve&).

Q.3. Respondent annual inco e ? +!n ,s.0-200000

20%

200000-400000 400000-600000 .bove 600000

10% 40% 30%

30% 25% 20% 15% 10% 5% 0% o-200000 200000-400000 400000-600000 above 600000

INTERPRETATION
(he above f!g$re shows that most&) peop&e/s ann$a& !n"ome !s between 4 &a"-6 &a" respe"t!ve&).

Q.!. "o #ou in$est one# for t%e safet# of future ? 0es 70% 1o 30%

0es 1o

INTERPRETATION From the above data shows that 70% of the respondents are !nvest the!r mone) and 30% are not. Q.&. And '%at
+!n per"entage0 to 5 5-10 10-15 15-20 20-25 .bove 25 20% 15% 20% 17% 12% 16%

percentage of #our inco e #ou in$est ?

20% 15% 10% 5% 0% 0-5 5-010 010-15 15-20 20-25 above 25

INTERPRETATION

(he above f!g$re shows that !n"ome; 5-10% are 15%; 10-15 % are and above 25% are 16% .

20% peop&e 20%; 1520

!nvest 5% of the!r ann$a& are 17% ; 20-25% are 12%

Q.(. "o #ou )no' *# %o' ?

uc% percentage t%e inflation is increasing

0es

40%

1o

60%

0es 1o

INTERPRETATION

From the above data shows that 40% of the respondents are 2now abo$t !n"reas!ng rate of !nf&at!on and 60% are not !ns$red.

Q.+. "o #ou plan for retire ent ?

0es 1o

60% 40%

40% 60%

INTERPRETATION
From the above data shows that 60% respondents are p&an for the!r ret!rement and 40% not .

Q., Are #ou satisfied 'it% #our plans for t%e retire ent ?

at!sf!ed 1ot at!sf!ed 1ot ,espond!ng

40 % 30 % 30 %

40% 35% 30% 25% 20% 15% 10% 5% 0% at!sf!ed 1ot at!sf!ed
1ot ,espond!ng

INTERPRETATION

0ostly people are satisfied $ith their retirement plans .

Q.-. .%at s%ould *e #our pension for a ont% ?

0-5000 5000-10000 10000-15000 15000-20000 20000-25000 .bove 25000 10% 10% 20% 20% 10% 30%

+!n ,s.-

30%

25% 20% 15% 10% 5% 0%

INTERPRETATION
3ost&) peop&e sa)s that the!r month&) pens!on sho$&d be between

10000 to 20000 .

Q.1/ "o #ou )no' %o' retire ent ?

uc%

one# do #ou need after #our

0es 1o

40% 60%

40%

60%

INTERPRETATION

2ostly people don^t know that how much money they need for their retirement .

Q.11. In '%at products #ou in$est #our

one# ?

3$t$a& f$nds 4ns$ran"e #oth 'thers

20% 15% 40% 25%

40% 35% 30% 25% 20% 15% 10% 5% 0% 3$t$a& f$nds 4ns$ran"e #oth 'thers

INTERPRETATION
From the above data shows that !nvest the!r mone) !n both m$t$a& f$nds and !ns$ran"e .

Q.12. "o #ou )no' a*out t%e plans '%ic% are offered *# t%e insurance co panies for retire ent?

0es 1o

45% 55%

60% 50% 40% 30% 20% 10% 0% 0es 1o

INTERPRETATION

From the above data shows that 45% peop&e 2now abo$t the prod$"ts wh!"h are offered b) the !ns$ran"e "ompan!es for ret!rement .

Q.13 "o #ou )no' a*out t%e present go$t. polices for pensions ?

0es 1o

40% 60%

60% 50% 40% 30% 20% 10% 0% 0es 1o

INTERPRETATION

From the above data shows that 40% respondents 2now abo$t the present govt. po&!"es for pens!ons and 60% not .

@#A> Do &ou %no! a out 4es 3o

BI$'. SU3 'IFE I3SU$.3CE BCD =CD

1o 30 %

0es
1o

0e s 70 %

INTERPRETATION

0ostly people are a$are of 1&(-

@#A(# Sources of a!areness of BI$'. SU3 'IFE ."vertisement Frien" circle Famil& mem er FC of BS'I

I3SU$.3CE >C D =C D EC D AC D

F5 of # 64 10%

.dvert!sement Fam!&) member .dvert!sement 20% 40% Fam!&) member F5 of # 64 Fr!end "!r"&e

Fr!end "!r"&e 30%

INTERPRETATION

2ostl& people %no! a out BS'I through a"vertisements #

@AF

Do &ou a!are of instruments !hich are availa le for &our happ& retirement -

4es 3o

=CD BCD

0e s 30 % 0es 1o
1o 70 %

INTERPRETATION

2ostl& people "onGt %no! a out the instruments #

@#AB Do &ou 4es 3o

thin% &ou have enough mone& for retirement 9onl& for respon"ents !hich are retire": =(D F(D

0e s 35 %

0es 1o
1o 65 %

INTERPRETATION

2ostl& people thin% that the& "oesnGt have enough mone& for retirement #

FI3DI35S
Following 7re the Findings of 2y 1tudy based on the work done in the company
2ost people invest a part of their income . 2ost of the people $who are retired % think that they doesn=t have enough money to live a happy retirement life.

2ost of the people doesn=t know about inflation that at what rate the inflation is increasing

2ost of the people does not know that how much money they needed for their retirement planning 2ost people make plans for their retirement 2ost of the people of my respondents are serviceman and they plan their retirement 2ost people does not know that what should be their retirement monthly pension. 2ost of the people does not know present govt. policies regarding pension o they doesn=t know that govt. is not giving pension to those people which (oin govt. posts after ;--G . 2ostly people says that their monthly pension should be between 9---- to ;---- . 3ut of the people which invest their money invest their money in both mutual o funds and insurance. 3ut of the people plan their retirement 2ost of them know the instruments for the retirement available in the market . 2ostly people are satisfied with their retirement plans . From the above data shows that B-L respondents know about the present govt. polices for pensions and G-L not . 2ostly people don=t know that how much money they need for their retirement .

BIB'IO5$.*H4
*E$IODIC.'S .3D 2.5.HI3ES+ Finance 'ndia, 6ournals 7nnual Report of

/usiness world

BOOIS 1 .$TIC'ES+

7rticle by 2r. 1. /. 2athur on .ontribution of 0ife 'nsurance 1ector in *he Economy.

7rticle /y Flobal Financial 1ervices on 'nsurance 'ndustry 1tatus dated 1eptember;G,;--+

,EBSITES www./irla .com www./irla lifeinsurance.com www.bimaguru.com www.irdaindia.or g www.indianexpress.com www.indiainfoline.com www.google.co.i n 3ther related websites. www.shvoong.co m www.library.idea.gov.uk www.0'..com

@UESTIO33.I $E

Q.1. Respondent
18-25 35-45

age group?
25-35 45-60

Q.2. "o #ou in$est 0es

one# for t%e safet# of future ? 1o

Q.3. Respondents profession ?

erv!"eman %rofess!ona&s #$s!ness man 'thers

Q.!. Respondent annual inco e ? +!n ,s.0-200000 400000600000 200000-400000 .bove 600000

Q.&. And '%at

+!n per"entage0 to 5 10-15 20-25

percentage of #our inco e #ou in$est ?

5-10 15-20 .bove 25

Q.(. "o #ou )no' *# %o'

uc% percentage t%e inflation is

increasing ?
0es 1 o

Q.+. "o #ou plan for retire ent ? 1 o

0es

Q., Are #ou satisfied 'it% #our plans for t%e retire ent ?
at!sf!ed 1ot ,espond!ng 1ot at!sf!ed

Q.- "o #ou )no' %o' retire ent ? 0es

uc% 1 o

one# do #ou need after #our

Q.1/. In '%at products #ou in$est #our

3$t$a& f$nds 4ns$ra n"e 'ther s

one# ?

#oth

Q.11. "o #ou )no' a*out t%e plans '%ic% are offered *# t%e insurance co panies for retire ent?
0es 1 o

Q.12. .%at s%ould *e #our pension for a

0-5000 10000500010000

ont% ? +!n ,s.-

1500020000 2000025000 .bove 25000

Q.13 "o #ou )no' a*out t%e present go$t. polices for pensions ?
0es 1 o

@#A > 4es @#A (

Do &ou a!are of instruments !hich are availa le for &our happ& retirement 3 o

4es

Do &ou thin% &ou have enough mone& for retirement 9onl& for respon"ents !hich are retire": 3 o