Pattabhiraman Murari of www.freefincal.com has asked me to speak for 3 hours on retirement planning. It is difficult to speak for 3 hours on retirement planning, because it is a simple topic and does not take so much time. Please understand being simple means – simple to understand. Not saying it is easy to do.

Like my friend Shammi Gupta. She is a brilliant Yoga teacher. It is very easy and nice to watch her do. Doing it? OMG that is the problem!!

So Retirement Planning 101, let us say consists of the following things:

1. Knowing when you will retire.

2. Knowing how long you and your spouse will live.

3. Knowing how much you will spend in this period

4. Knowing how much your medical expenses will be.

5. Starting to save/ invest as soon as possible  (understanding, and so tapping Compounding)

6. Investing as much as possible, as quickly as possible, and not interrupting the compounding.

7. Understanding asset classes – equity, debt, cash and real estate

8. Understanding asset class returns, standard deviation, mean, and reversion to the mean.

9. Understanding Asset Allocation.

10. Knowing that Cost really matters, and one way of mitigating costs is through higher saving.

That is all. And I am going to speak about just the following items…and nothing new.

You will hear about all this on Friday, 29th May, 2015 at Chennai. Nothing great.

I hope that you realise that 1-4 is a joke – nobody can estimate these 4..so what you have to do is from 5 to 10 !!

Start of with a prayer on your lips, a white board, Pattu’s calculators, and an adviser. Chances are in about 5 years you would have learnt why you do not need an adviser. If the adviser is good he would have delivered good results by now and you would do away with the doubt of whether you need an adviser….

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  1. pardon my impudence, Subrabhai, but if you could also touch upon cash flow — generation and management.

  2. i have a query if you can clear my doubt…

    I was just about to press a button of Endowment policy and put it on hold , thanks to your articles.
    I want to take a 1cr term insurance.
    Can I take 50lac frm lic, 25lac icici, 25lac hdfc……?
    will this diverse my risk ?
    or should I take from one firm altogether?
    Will I need to declare the policies taken to all firms ?

    Pls clear my doubt. Thankyou.

  3. I hope that you realise that 1-4 is a joke – nobody can estimate these 4..so what you have to do is from 5 to 10 !!

    BANG ON!!!

    But then how to plan if there are going to be unknowns like these?

  4. @ Digant….Go for any one of the mentioned Insurance companies. My advice, dont diversify here. The most important thing is to ensure that you fill all the details correctly and truthfully in the application form. By doing so, in an unfortunate event, your claim will be processed without any problem. Yes, you will have to declare all the policies in case you are taking more than one.

  5. @Digant

    I would suggest splitting into 2 max. Ratio I leave it to you.

    Having LIC means worst come worst if your claim on the private player is rejected your family has a decent probablity (note probability not surity) that part of your insurance claim corpus from LIC is honoured.

    If you have correctly and truly provided all details & one of your claims got denied – your ghost or your family can file a case with ombudsman that claim sanctioned from first provider but denied from second provider.

  6. Dear Subra Sir,

    Thank you pattu sir for organising the event yesterday.Subra sir it was time well spent for me and the 20 cr example of corpus needed for retirement was a much needed shock.I downloaded the calculator by pattu and arrived at my retirement fund needed and that kept me awake all night.You explained things so simple and i much appreciate your sense of humour and stories to explain the key agenda..I have now begun with the calculators and hope to start investing ASAP and in SIPs,the example and the pie chart on how much leisure is available during work life and post retirement was simple but ignored.More leisure during retirement meant more opportunity to spend hence more money needed during retirement..the kesari travels eg was hilarious and is so true..Thank you for explaing RISK and COMPOUNDING! A Big thank you for making a difference in our lives and on our financial literacy path..
    Best wishes
    Vinod Natarajan

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