What is a retirement calculator?
A retirement calculator is a simple online calculator that helps you figure out how much money you will require in your retirement based on your current expenditures. Here is a basic online retirement calculator for which you need your expected annual contribution (the money you want to invest per year for your retirement), your expected interest rate on your investments and the number of years you want to continue your investments.
Why don't people start investing for their retirements early?
Most people who start earning don't take their retirement seriously. They often don't take the help of retirement calculators to plan their retirement. And when someone tells them they need money in crores for their retirements they often leave all those things to the fate, which doesn't work with those who don't plan well. So, you should plan your retirement early. In fact, you should start investing for your retirement with your first paycheck.
Also, most of the working class think that their compulsory contributions to pension funds can accumulate enough in the long run and that will take care of their retirements which is incorrect. Until you do a thorough retirement planning considering all your expenditures, the impact of inflation, job loss, loans and mortgages, you can't determine how much money will be sufficient for your retirement.
Importance of retirement calculators and sound financial planning in India
In India, however, people save more but they don't invest in appreciating assets; instead, keep their money in savings accounts which don't yield good returns. For example, a savings account pays only 2-3% returns on your savings while equity funds and other equity-related assets provide more than 10-15% ROI.
FAQ: (Frequently Asked Questions Related to Retirement Calculators)
1- Is there any retirement planning calculator with pension schemes assimilated in it for calculation?
A retirement planning calculator tells you how much money you will accumulate for your retirement if you put an amount for a certain period of time with a certain rate of interest. Usually, people invest money in various assets for their retirement. So, it can be easily calculated by adding up various investments to calculate an aggregate retirement corpus.
2- Which retirement plan is best in India to accumulate enough funds for retirement?
Retirement planning should be done with the help of experts if you don't know various ways to invest your hard-earned money. Professional advice will help you to diversify your money to reduce the risk. You can contact any registered investment advisor to help you out with this.
3- Where to invest retirement money in India for a peaceful retirement?
There are many ways to invest your retirement money in India. For example, you can invest in stocks and mutual funds, Public Provident Funds, EPF, Fixed Deposits, Kisan Vikas Patra, NPS, NSC etc. (We don't provide any investment advice, all the information here is only for informational purposes)
4- How much retirement corpus do I need if I want to retire at the age of 58?
A retirement calculator is of great help to let you know these types of questions. If your current expenditures are 50000 Rs a month and you are 40 years old. You have 18 years until retirement. If the inflation of India stays at 5.5%, you will require 131000+ Rs a month to cover your expenditures. As the life expectancy of Indians, according to 2021 figures is 67 years, you will require a corpus of over 2.5 crore. You should plan it today not tommorrow because as per CRR's report close to half of households struggle to plan well their retirement. This is U.S report although the figures are not different for India.
5- How much money is required for retirement if I want to retire now?
Well, if you know your current expenditures, your expected retirement age, and a modest rate of return on your investments, we can easily figure it out how much money is required for retirement. But, because the inflation of the country and the rate of returns on investment are not fixed this figure may vary slightly. But, we can come close to a figure which will likely be accurate.
6. Can we use the retirement calculator for calculating our SIP returns in mutual funds?
A sip calculator for mutual funds calculates total value based on given inputs. And we have already created it. So, you can get help from it.
7. Can the retirement calculator give the inaccurate information?
No. It gives accurate information based on the given inputs. There is no chance of inaccuracy.
8. Do, we need to pay anything if we use MrMoneyFrugal's retirement calculator?
There are no charges for using our calculator. You can use it as many times as you want. You can also refer it to your friends, relatives, and colleagues.
9. Can I recommend any changes to the calculator if I find one?
We are always open to discussion and improvement in the things we offer. If you have anything to share you are free to contact us. You can also recommend us anything which you want to know about but don't find it here. It is always discussions that change things for good.