Typically, retirement is the last and most important financial goal for most families. Before retirement, the kids would have started working and sometimes married too. However, this dynamic is fast-shifting because normal retirement is no longer at 60. It is now 50- 55.
Additionally, more and more people are getting married and becoming parents late. This means that kids may still be in school at retirement. So, how do we plan for this scenario?
Recently, a reader wrote: “Thanks a lot for this amazing tool to plan retirement. I wanted some help planning for certain expenses after retirement – a child’s college education, retirement house construction, marriage, annual vacations, car purchases, etc. As you can see, some of these expenses will be one-time (retirement-house construction, child’s marriage). In contrast, some others will recur for a certain period (child education, vacations and car purchases).
I would like to see if the corpus I have already built (or would have built as of the retirement year) would cover these expenses. If my retirement corpus does not cover these expenses, I must build additional buckets/corpora from now until retirement month. If so, I would like to know how much additional investments I will have to make from the current month until retirement month.
I am a non-finance / non-Excel person. So, perhaps this capability already exists, and I cannot figure it out. If these features do not exist currently, it would be awesome if they could be added to the FreeFinCal Robo Advisory Template.”
🔥Secure your future with our Robo-advisory tool trusted by over 3,500 investors and advisors. From effortless retirement planning to funding your children’s biggest dreams, turn your financial goals into reality. 🔥
Subscribe for money management solutions via email! (Link takes you to our email sign-up form) Join 32,000+ readers in our community.
👉 New Tool Alert! NaviPlan: A Privacy-Focused Multi-asset Tracker and Goal Planner 👈
The freefincal robo advisor tool can handle goals that occur after retirement. You can either plan for this via a lump sum investment. Here is an example.
Consider a couple, both aged 40. Their monthly expenses are Rs. 1 Lakh. If they wish to retire at age 50, the corpus required is Rs. 7.92 Crore. The robo tool allows you to factor in existing investments and income sources after retirement. We shall not consider these here as our goal is different.
Suppose the couple has a goal/expense whose current cost is Rs. 50 Lakhs in 15 years. They will need this money five years after retirement. The future cost will be a little over two crores. There are two ways to account for this. They can invest a lump sum (Rs. 65 lakhs, depending on inputs and assumptions) or Rs. 60,000 (approximately) for the next 15 years.
If they choose the lump sum option, they have to plan to invest Rs. 65 lakhs (in this case) independently of their retirement planning. They will have to source Rs. 65 lakhs from their investments, and the rest will be their retirement corpus.
If they choose the monthly investing option, then after retirement, they will have to fund this investment from their retirement corpus. So, the corpus will increase from Rs. 7.92 Crores to Rs. 8.27 Crores.
Freefincal Robo Tool users can change between lump sum and SIP options in Step 6A Cash Flow. First, they will have to select “Yes” to include the goal in the cash flow chart in Step 6B, and they choose the Monthly or Lump Sum option, as shown in the screenshot below.
Join 32,000+ readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! (Link takes you to our email sign-up form)
Use our Robo-advisory Tool to create a complete financial plan! More than 3,000 investors and advisors use this! Use the discount code robo25 for 20% off. Plan your retirement (early, normal, before, and after), plus non-recurring financial goals (such as child education) and recurring financial goals (such as holidays and appliance purchases). The tool helps anyone aged 18 to 80 plan for retirement, plus six non-recurring and four recurring financial goals, with a detailed cash flow summary.
🔥Join our community of 9000+ users! 🔥Avail massive discounts on our courses + freefincal investor circle!
Track your mutual funds and stock investments with our Google Sheet!
We also publish monthly equity mutual funds, debt and hybrid mutual funds, index funds, ETF screeners, as well as momentum and low-volatility stock screeners.
You can follow our articles on Google News
We have over 1,000 videos on YouTube!
Podcast: Let's Get RICH With PATTU! Every single Indian CAN grow their wealth!
You can watch podcast episodes on the OfSpin Media Friends YouTube Channel
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter using the form below.
- Hit 'reply' to any email from us! We do not offer personalised investment advice. We can write a detailed article without mentioning your name if you have a generic question.
About The Author
Dr M. Pattabiraman (PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over 14 years of experience publishing news analysis, research and financial product development.
Connect with him via Twitter(X) LinkedIn YouTube
Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! More than 3,500 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 the market conditions! Watch the first lecture for free! One-time payment! No recurring fees! Lifelong access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Increase your income by getting people to pay for your skills! More than 900 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 seeking more clients through online visibility, or a salaried individual looking for side or passive income, we will show you how to do it by showcasing your skills and building a community that trusts and pays you. (Watch the 1st lecture for free). One-time payment! No recurring fees! Lifelong access to videos!
Our 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 is for those interested in getting a side income via content writing. It is available at a 50% discount for Rs. 500 only!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & its content policy
Freefincal is a News Media organisation 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 with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact Information: To get in touch, please use our contact form. (Sponsored posts or paid collaborations will not be entertained.)Connect with us on social media
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
