Rising Inflation: Navigating the Uncertainty

With the increase in inflation, retirees may find it difficult to cope. However, it is possible to combat inflation and ensure that you don't run out of money if you take the necessary steps accordingly.

Tips to Navigate Uncertainty During Rising Inflation

Planning for a retirement amidst rents, EMIs, emergencies, and other commitments can be tedious for Indians, especially those in the lower-income groups. However, with the growing life expectancy, planning for retirement in advance makes it an essential, especially in recent times. 

Amongst the 4 phases of retirement, the pre-retirement phase is probably the toughest one. However, with many factors to be considered while planning for retirement, most of us tend to leave out the most crucial one: inflation.

Also Read: Should You Resort To Gold During Inflation

In addition to being money surplus, having a retirement plan also helps you deal with medical emergencies, fulfil life aspirations and be financially independent in the long term.

Here are some tips that might come in handy with planning a secured retirement while combating inflation.

Do not put your savings at risk

Dealing with inflation can be a task, especially with the soaring cost of living. During such times, risk management comes into play. You plan your investments in a manner to reduce risk. These risk management measures become even more critical the closer you are to your retirement because that is when you want to have sufficient money available with you to meet your goals and needs.

Also Read: How Debt Funds Can Beat Inflation And Interest Rate Risks?

For instance, if you talk to a financial advisor about ways to protect your retirement from inflation and suggest you drastically change your portfolio for a better chance of a higher return, that's a huge red flag. In case of setbacks in the market, you could face massive losses if you take on more risk, leaving you with less money and failing your retirement plans. 

Diversify and coordinate your sources of income

After receiving paychecks from your employer, making your payment arrangements can be a massive step toward retirement planning. Inflation can make this process even more challenging for you if you live in retirement for 20 years, 30 years, or even longer. Over time, you will need to increase your retirement income, so you need to factor that into your retirement plan for long term benefits. 

With a solid, diverse retirement income plan that includes more than just retirement savings and investment plans your employer offers, you can rest assured that you won't run out of money. 

We have consolidated a list of investment instruments to help you out. 

Rental income and passive income from freelancing roles could also add to your income. 

The Bottom Line

The key to a happy and secured retirement is to plan it, taking inflation, interest rate hikes, and unexpected changes. 

As humans, it is natural to make mistakes during your retirement planning. In such a situation, you can seek the assistance of a financial expert in determining the best way to meet your retirement goals and needs.

Planning for a retirement amidst rents, EMIs, emergencies, and other commitments can be tedious for Indians, especially those in the lower-income groups. However, with the growing life expectancy, planning for retirement in advance makes it an essential, especially in recent times. 

Amongst the 4 phases of retirement, the pre-retirement phase is probably the toughest one. However, with many factors to be considered while planning for retirement, most of us tend to leave out the most crucial one: inflation.

Also Read: Should You Resort To Gold During Inflation

In addition to being money surplus, having a retirement plan also helps you deal with medical emergencies, fulfil life aspirations and be financially independent in the long term.

Here are some tips that might come in handy with planning a secured retirement while combating inflation.

Do not put your savings at risk

Dealing with inflation can be a task, especially with the soaring cost of living. During such times, risk management comes into play. You plan your investments in a manner to reduce risk. These risk management measures become even more critical the closer you are to your retirement because that is when you want to have sufficient money available with you to meet your goals and needs.

Also Read: How Debt Funds Can Beat Inflation And Interest Rate Risks?

For instance, if you talk to a financial advisor about ways to protect your retirement from inflation and suggest you drastically change your portfolio for a better chance of a higher return, that's a huge red flag. In case of setbacks in the market, you could face massive losses if you take on more risk, leaving you with less money and failing your retirement plans. 

Diversify and coordinate your sources of income

After receiving paychecks from your employer, making your payment arrangements can be a massive step toward retirement planning. Inflation can make this process even more challenging for you if you live in retirement for 20 years, 30 years, or even longer. Over time, you will need to increase your retirement income, so you need to factor that into your retirement plan for long term benefits. 

With a solid, diverse retirement income plan that includes more than just retirement savings and investment plans your employer offers, you can rest assured that you won't run out of money. 

We have consolidated a list of investment instruments to help you out. 

Rental income and passive income from freelancing roles could also add to your income. 

The Bottom Line

The key to a happy and secured retirement is to plan it, taking inflation, interest rate hikes, and unexpected changes. 

As humans, it is natural to make mistakes during your retirement planning. In such a situation, you can seek the assistance of a financial expert in determining the best way to meet your retirement goals and needs.

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