Here’s a breakdown of commonly given but unhelpful retirement advice and why it doesn’t hold water:

1. "You Need to Know How Much Money You'll Need for Retirement"

• Why It’s Dumb:
• It’s nearly impossible for someone in their 20s or 30s to accurately predict expenses decades into the future.

• Life events, inflation, medical advancements, and personal choices make such forecasts futile.

• Better Approach:

• Focus on consistent saving and investing. Start early and regularly adjust contributions based on your income, lifestyle changes, and updated goals.

2. "Assume Inflation at 9% for Corpus Calculations"

• Why It’s Unrealistic:
• Inflation rates vary significantly over time and depend on your personal consumption habits, location, and economic trends.

• Blindly using a fixed rate ignores reality.

• Better Approach:

• Track your personal inflation rate by analyzing your spending patterns every few years. Use this as a guide for revising your retirement plan.

3. "Home EMI and Kids' Education Expenses Will Disappear"

• Why It’s Naive:
• Sure, EMIs and school fees may end, but other expenses like healthcare, maintenance costs, societal fees, and lifestyle upgrades can surge.

• Aging homes need repairs; grandchildren and hobbies might add new expenses.

• Better Approach:

• Factor in ongoing and new expenses, especially healthcare and maintenance costs, which often rise post-retirement.

4. "You Must Save for Retirement"

• Why It’s Misleading:
• Saving alone isn’t enough. Stashing money in low-yield instruments like NSC, FDs, or endowment plans won’t beat inflation over time.

• You risk having insufficient funds in your golden years.

• Better Approach:

• Invest, don’t just save. Use a diversified mix of equity, mutual funds, and other growth-oriented assets to build wealth.

5. "Invest in Equity or Real Estate for Higher Returns"

• Why It’s Half-Baked Advice:
• Equity and real estate are important, but they come with risks. Blindly investing without understanding your risk tolerance, time horizon, or asset class performance can backfire.

• Real estate, especially, is illiquid and may not always provide good returns.

• Better Approach:

• Diversify across equity, debt, real estate, and other asset classes based on your risk appetite and retirement timeline.

6. "Shift to Safe Assets at 60"

• Why It’s Outdated:
• Retirements often last 20–30 years. Relying solely on "safe" assets like FDs or NSC may lead to a shortfall due to low returns and inflation.

• Equities remain critical even in retirement to generate growth and sustain income.

• Better Approach:

• Adopt a bucket strategy:
  • Short-term needs (1–5 years): Keep in low-risk assets like FDs or liquid funds.
  • Mid-term needs (5–15 years): Use balanced funds or bonds.
  • Long-term needs (15+ years): Stay invested in equity for growth.

To Sum it all

• Retirement planning isn’t a one-size-fits-all process. It evolves with your life and requires flexibility and regular updates.
• Save Smart: Combine disciplined saving with thoughtful investing.
• Review Regularly: Check your retirement corpus, expenses, and inflation projections every few years.
• Keep Growing: Maintain some exposure to equities even in retirement to outpace inflation.

Start early, plan wisely, and adjust frequently. Remember, retirement planning is about staying prepared, not perfect.

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