Retirement is the time when you are free of work commitments and can indulge your dreams. One of the most common dreams that people have is building a retirement home. Whether it is a haven of peace amidst greenery and mountains or a simple 1 BHK in the city, you need to plan for it properly
Here are a few tips that can help you realise this dream.
Calculate the amount you would need
You need to estimate the amount that you would need for covering all the expenses. Some significant costs you may encounter when building your dream retirement home are listed below.
- The price of the house or the amount you would need to build it from the ground up
- The legal expenses towards registration and other formalities
- Architect or the interior designer costs
- Expenses towards furnishing the house
- Miscellaneous expenses
Do not forget to consider inflation when you are planning to raise a corpus for your retirement home.
Make saving a habit
You need to start saving early to build your retirement home. When saving for the house, ensure that it does not encroach on your other responsibilities. Do not use up all your savings. You must have enough money for yourself and your family after you retire. An effective tip is to set aside a part of your salary for your retirement home. You can open a dedicated savings account or an FD for this purpose. Ensure that you choose a bank with a good interest rate so that you can capitalise on your savings as well.
Just saving is not enough, you must ensure that you invest your money correctly. You may be inclined to keep away from risky investments like equity funds, but they can give you excellent returns. Experts advise on maintaining a healthy portfolio by balancing out the risks with a mix of debt and equity funds, stocks and other forms of investment. The returns can help you pay off your EMIs or other expenses incurred in building the house.
Pay off your debt before you retire
You must not delay paying off your Home loan EMIs or other payments for your retirement home. In case the payment is due, even after you retire, you may have to use your savings for it. Sincesavings are your only source of income during this time, it can affect your other financial requirements.Hence, paying off your loans and other dues before you retire is important.
These simple tipscan go a long way in helping you build your dream retirement home. Ensure that you invest wisely, save thoughtfully, and buy the right retirement plan to help you realise your dream.