A reader writes, “I have now been reading your articles on the importance of asset allocation for a few months now. The impact of inflation is scary! I have no equity holdings in my portfolio and have never planned for retirement in a systematic way. Is there any hope for me or is it too late?”
To understand what the reader means by scary inflation see: Inflation has reduced Rs. one lakh to just Rs. 6000 in 40 years! Now to answer his question, “is it too late?”
At age 40 with a good 15 years* away from retirement, it is late. Whether it is too late or not depends on how quickly you accept and implement the following steps. *We cannot expect to work until age 60. See How to prepare for the “new normal” in retirement planning.
- You need professional help! Do consider working with one of the SEBI registered fee-only advisors on our list. Many of our readers are working with them and have given excellent feedback: 685 investors rate their experience with SEBI registered fee-only advisors (currently more than 1000 of our community are working with such advisors). Note: There is no monetary gain involved for freefincal from this recommendation.
- If you would like to know what to expect from such an advisor, see: How a fee-only financial planner helped me. US/Canada NRIs can find an Hourly-Fee Financial Planner on HourlyFee.org.
- The fee-only advisor has no conflict of interest (will not sell products for which she gets commissions) and will advise on your asset allocation: Do you need equity investments at this stage? If yes, how much? etc.
- The key is to trust them and implement their advice immediately.
While the above will take care of the major part of the problem, we recommend the following steps.
- Take a good hard look at your lifestyle along with your partner and list your current expenses that will continue in retirement. Let us call this X.
- Try to reduce some expenses or at the very least, do not add more want-based expenses and certainly not any new loans.
- Your goal from this point on should be to invest as much as possible for retirement after accounting for your children’s needs.
- If X = Rs. 40,000 then your total investment for retirement (including EPF, NPS mandatory deductions) should be at least Rs. 40,000 preferably (much) more!
- If we assume your current fixed income instruments grow as is, the asset allocation recommended by the freefincal robo advisory template for future investments is shown below.
Pre-retirement equity and fixed income allocation as a function of age as suggested by the freefincal robo advisory template. - Although it would seem like 60% of what you can invest each month for retirement should go to equity, only a small portion of your networth will be invested in equity.
- If this is hard for you to accept or if you cannot manage to invest Rs. X per month (including EPF contributions) then you can start slow, but not too slow! Please get used to it over about 12 months, not more.
- Do not rush to invest Rs. 1.5 lakhs in PPF each year! Also see: PPF will not make us crorepatis! We need to take risks for that! That is, you need to get over your fascination with tax-free instruments, tax-saving instruments and high rate of interest instruments.
- Try to increase your income using your skill set! See Passive Income Template: Steps to build a lifelong income! You certainly have enough time to do this from age 40 to age 55.
Remember the goal is to fill the glass as much as possible. An all (full glass) or nothing (empty glass) attitude is harmful. There is no room for regret in life and investing. What is done is done. What must be done, must be done swiftly.
Get free money management solutions delivered to your mailbox! Subscribe to get posts via email!
🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥
🔥Enjoy massive discounts on our courses and robo-advisory tool! 🔥
Use our Robo-advisory Excel Tool for a start-to-finish financial plan! ⇐ More than 1000 investors and advisors use this!
New Tool! => Track your mutual funds and stocks investments with this Google Sheet!
- Follow us on Google News.
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Join our YouTube Community and explore more than 1000 videos!
- Have a question? Subscribe to our newsletter with this form.
- Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Get free money management solutions delivered to your mailbox! Subscribe to get posts via email!
Explore the site! Search among our 2000+ articles for information and insight!
About The Author

Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts you and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu gets a superpower!” is now available!


Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or you buy the new Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low volatility stock screeners.
About freefincal & its content policy Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified from credible and knowledgeable sources before publication. Freefincal does not publish any paid articles, promotions, PR, satire or opinions without data. All opinions presented will only be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our Youtube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing

Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want

Your Ultimate Guide to Travel
