START EARLY, RETIRE RICH

START EARLY, RETIRE RICH
Those of us who still have many years to go before retiring tend to think of retirement in terms of fuzzy clichés like tending to the roses, long walks by the sea, playing golf on weekdays, pottering around the house and so on. But those staring retirement in the face invariably think of grimmer things like steep medical costs, shriveling income stream, taxes, inflation and the rising cost of living, and of whether their savings can meet all these expenses. When it comes to planning retirement, the bottom line is this: you either are in saving mode or you are in spending mode.The pre-retirement phase of life includes many financial responsibilities and goals such as building a house or providing for children’s education, besides planning your own retirement. Yet, many of us remember retirement just a few years ahead of the ‘R-day’. Arriving at how much retirement savings you should have is a tough one, but one can fairly estimate one’s needs depending on the lifestyle one maintains in retirement. It will help to prepare a budget which lists what you spend on necessities so that you know how much your monthly or annual expenditure will be in the future. Account for inflation keeping a rough estimate of 7-8 per cent inflation every year. Also, consider expenses that are bound to increase, such as medical and transport expenses. Then again, calculate the expenses that may cease to exist, such as your children’s education or repayment on a home loan.The accumulation phase, where you can save and invest for your golden years can start anytime from the day you start earning and while there are many ways that one can save; life insurance is a component that plays an important role. It is a protection tool that safeguards the interest of your financial dependents in case you die; it also helps you build a cosy retirement egg which you can utilise in your own retirement. Of course, if you start at a late age you will have to increase your savings substantially and even cut down on any superfluous expenses. Starting early will help you benefit through the power of compounding, that is, you have more time for your money to grow.The advantage with life insurance is that it instills regular savings habit which is systematic with regular payments towards premiums and offers tax benefits on savings as well as withdrawal on maturity. There is also professional money management that insurance products offer, which is far better than handling it ourselves. As you approach retirement, you need to assess how long your savings can last in retirement and lead your retired life. With increasing life expectancy we are facing a situation where our years in retirement can be as long as or more than our working years depending on when one retires.Reality is that once retirement is reached, the saving period is over. The balancing act at this point is between the desire to enjoy retirement and the fear of running out of money prematurely. The way the retirement life insurance plans are structured; you get a tax free lump sum to withdraw from your accumulated savings with the balance paid as a monthly annuity acting as a regular income stream. But there are ways to supplement this income stream; one can consider working beyond retirement which could be part time or in the immediate future make illiquid assets pay better.Research indicates majority of Indians owning a house much before they retire, the reverse mortgage facility makes the house that one owns pay a regular income stream for a fixed number of years or trough the life of the house owner. One can tactfully opt for an insurance policy in retirement which will swap the value of the house on the reverse mortgage option on the insured’s death, with the house ownership being bequeathed to the insured’s family. This way not only can one earn income from one’s house; one can also pass the house to the next generation. At the end of the day, retirement is a journey and what matters is that you get to your destination with a clear road map and make sure you enjoy the journey.

FUNtastic lessons from Zindagi Na Milegi Dubara

FUNtastic lessons from Zindagi Na Milegi Dubara

The racing bulls are running full-tilt on the streets of Pamplona, scattering all-comers under horn and hoof. As they round the home stretch, we meet Abhay Deol, flying around the corner, head held high, eyes twinkling, and a ghost of a smile on his lips. Likewise, Farhan Akhtar and Hrithik Roshan also crank up the gears and, face-forward, race towards the gates.

This final sequence of the movie Zindagi Na Milegi Dubara (ZNMD) is probably one of the best metaphors for how life—personal or professional—can be lived successfully.

So what’s that all-important metaphor? It’s not that they’re running fast, and are in the right physical shape to do so. Yes, that’s important. But the key is that they are looking forward. Yes, the demons from past mistakes are always behind you. But future holds that success, the achievement that you are constantly aspiring for. So focus everything, confidently and joyously, on that prospective goal. Then the past will hold no importance, nor fear.

ZNMD has many such lessons, especially for the corporate world, if one wishes to imbibe them. One can say with quite a lot of certainty that this was definitely not Zoya Akhtar’s aim when she made this wholly entertaining movie, to reduce it training material for a corporate workshop. But we are all richer for the material it provides us, as reminders for a better way of life, professionally.

Let’s take the issue of coping with fear and anxiety for instance. We face this at all levels. And a lot of times, this is our biggest enemy in meeting our goals. Each of the three protagonists in ZNMD take turns in vehemently professing their fears—of deep-sea diving, of sky-diving, and running with the bulls. And yet, the strategy they use to overcome the fears is one we would do well to inculcate into the corporate world. (1) Acknowledge and announce the fear to those around you. (2) Give yourself no choice but to overcome it. (3) Enjoy the life-changing perspective that follows afterwards. A crucial part of the strategy is to have people around you who understand your fear, and are there in helping you overcome it, rather than ridiculing you for it or taking advantage of your fear to their own benefit. Trust and teamwork, therefore, become paramount.

ZNMD also reminds us that we’re often stuck in the past or mindlessly pursuing a distant future. In the process, we ignore the immense possibilities of the here and now. There’s a sequence after the Tomatina Festival when our heroes have left Buñol (Valencia) and are motoring along towards Pamplona (or Seville?). Katrina Kaif chases them down on a bike, just to tell Hrithik Roshan, “Mujhe afsos karna nahi aata / I don’t know how to regret.” For Hrithik, it’s a double whammy when Katrina tells him at another point in the movie, “Yes, but what if you don’t live to see 40? Live now, live for now.” It’s a turning point in self-discovery and mindfulness for Hrithik. And a reminder to us in the corporate world—that goals are good, and history can be a good teacher. But what matters is how we tackle each day, and make the most of it. When we passionately immerse ourselves in what we do today, productivity and success take care of themselves. And we enjoy the journey as much as the destination.

There is also a metamorphosis in the characters of the three protagonists as ZNMD progresses. Farhan Akhtar acknowledges the angst beneath his frivolity, and ultimately overcomes it. Abhay Deol confronts a forced circumstantial choice and reverses it. And Hrithik Roshan comes face to face with the near-farcical chase his life has become, and turns over a new leaf. In doing so, they all ably demonstrate—in different ways—the inevitability of change, and the innate ability to transform that each of us possesses. We always acknowledge that change is a constant, and yet are afraid to transform—ourselves, our circumstances, those around us, and our decisions. And yet, true progress and success lie in just that. In going beyond the comfort zone of familiarity. In recognizing what constrains us, and moving beyond them. To recall another powerful line from an altogether different movie, “It doesn’t matter that we fall. What matters is that we get up again.” (From “Batman Begins,” if you must know the movie name.)

When it comes to that, perhaps the lesson of freeing ourselves from constraints is the one we can most easily take out of ZNMD. The world offers us a plethora of options to shake off our everyday shackles, and experience real, intrinsic freedom. We don’t need to dive among the sea urchins, draw figures of eight in the sky or have near-death experiences among bovine companions. But we can still find ways to be creative, and inspire ourselves on a daily basis. With music. With games. With not being slaves to habit. With just this singular perspective, that we have this one life to make the most of. Let’s go seize it.