I’m 33, married and earn about ₹60,000 per month. How do I save for retirement?


I am 33, married, and earn about 60,000 a month. I currently have a number of loans to repay and have limited savings besides EPF. I would like to start saving to grow wealth and look for a good corpus for retirement and life goals such as child’s education and marriage. So far we don’t have kids, but probably it won’t be more than two in any case. Please advise which funds or scheme I should start with. I am able to save about 6,000-7,000 a month.

—Vikas Sharma


It is always better to start early, and although at present most of your savings are in EPF, you still have a long time to invest and accumulate for goals such as retirement, education of children and their marriage. If retirement is your primary financial goal at present the way to work on it is to first define at what age you would like to retire. The definition of retirement may change over time and many of us may not formally retire and may take up some kind of consultancy or other part-time activity. However, one thing is sure that the monthly inflow of income may reduce whenever you decide to leave your job. As you are 33 if we consider a retirement age of 55 you have good 22 years to build your retirement corpus. Usually, the retirement corpus is based on your monthly expenses at the retirement stage. Since that information is not available at present. Let us assume you invest 7,000 every month in equity mutual funds for the remaining year then at 10% per annum return you will be able to accumulate about 63 lakh and if the return is 12% per annum, then this amount would be about 82 lakh. In case you plan to retire at 60 the accumulated amount can be 1.07 crore and 1.51 crore at 10% per annum and 12% per annum respectively. This may be insufficient for your retirement as you will have expenses of more than 20 years of the post-retirement to take care of through this accumulated amount. Hence, you may relook at your monthly cash flow and try to increase the monthly investment amount if possible. Another thing you can do is to increase the monthly investment every year by 10% as you progress in your career. If you try to do so you will be able to accumulate 1.44 crore at the age of 55 and 2.84 crore at the age of 60 assuming a 10% per annum rate of return.

You may consider the following funds to start with your investment.

UTI Nifty Index Fund ( 2,000); Canara Robeco Bluechip Fund ( 1,500); Mirae Asset Emerging Bluechip Fund ( 2,000); Parag Parikh Flexi Cap Fund ( 1,500).

Queries answered by Harshad Chetanwala, founder, MyWealthGrowth.com. Have personal finance queries? Send an email to [email protected] 

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