Retirement Planning

Retirement is one of lifes biggest worries and retirement plans play a crucial role in providing a source of income in a persons retired years. Retirement can span up to a third of a lifetime. Retirement plans are much like saving for a 25-year vacation. To afford an expense of that magnitude a person needs to start planning early. Age has a critical impact on ones ability to save.

The Social Security system, company retirement policies and personal lifetime savings are the three sources from where funds are drawn to pay for expenses after retirement. There are several plans that benefit employers and employees alike. A qualified retirement plan is a plan that meets the requirements of the Internal Revenue Code (IRC) and the Employee Retirement Income Security Act of 1974 (ERISA). The plan attracts many tax benefits.

A plan that does not meet the requirements of the IRC or ERISA is known as a non-qualified retirement plan. These plans are typically used to provide deferred compensation to key employees. The plan allows wider flexibility to an employer and therefore, they do not receive tax deductions until the employee receives proceeds from the plan.

A defined benefit plan is a traditional company pension plan. The retirement benefit is determinable as a dollar amount or as a percentage of wages. These plans are funded entirely by the employer and the responsibility for payment of the accompanying benefits rests with the employer.

A defined contribution plan is a retirement plan in which the contribution is defined, but the ultimate amount of benefit to be paid is not. The actual benefit at the time of retirement depends on the amount contributed over the years and on the investment performance of the account through the years. In this retirement plan, the investment risk may rest solely with the employee. These plans are known by various names such as money purchase, profit sharing, 401(k), or 403(b) plans.

An Individual Retirement Arrangement (IRA) is a personal retirement savings plan available to any individual, regardless of age, who receives taxable compensation during the year. Wages, salaries, fees, tips, bonuses, commissions and taxable alimony are all included.

Retirement plans are a long-term goal that requires steady, long-term saving. To ensure a comfortable retired life, studying and participating in at least some of the various retirement investment plans is critical.


  • MF News
  • IPO News

How to accomplish your financial goals through twin strategy of SIP and SWP It’s advisable to adopt the twin strategy of Systematic Investment Plan (SIP) and Systematic Withdrawal Plan (SWP) to meet financial goals.
Fri, 16 Feb 2018 10:12:01 +0530


Direct plans of mutual funds: Why do they suit everyone Product awareness campaigns by market participants and sustained backing from the regulator would motivate more retail investors to embrace direct plans.
Fri, 09 Feb 2018 10:35:25 +0530


S Naren Investors had forgotten the word ‘risk’ and now they will be more careful, said investors had forgotten the word ‘risk’ and now they will be more careful.
Wed, 07 Feb 2018 11:31:14 +0530


Dr.Renu Pothen GOI has decided to introduce a 10% tax on long term capital gains on equities and equity oriented mutual funds exceeding INR 1 lakh.
Fri, 02 Feb 2018 15:21:35 +0530


Lalit Nambiar Watch the interview of Lalit Nambiar of UTI MF with Prashant Nair and Ekta Batra of CNBC-TV18, where he shared his readings and outlook on the fundamentals of the market, and specific stocks and sectors.
Tue, 23 Jan 2018 12:04:32 +0530


Harsha Upadhyaya The expert believes that it would be prudent to tilt the portfolio towards largecaps, where valuations are slightly better.
Mon, 22 Jan 2018 11:01:26 +0530


Sunil Subramaniam In an interview with CNBC-TV18, Sunil Subramaniam, CEO of Sundaram Mutual Fund discussed the mutual fund (MF) industry wish-list and their expectations from Budget 2018.
Thu, 18 Jan 2018 14:56:59 +0530


Bill Maldonado The one thing they like about investing in India is the prudent manner in which the economy has been managed by the government and the RBI, said Bill Maldonado of HSBC Global AMC.
Fri, 12 Jan 2018 15:50:33 +0530


S Krishna Kumar The overall market is factoring in a lot of positive news, said S Krishna Kumar. Cues such as India being fastest-growing economy going ahead along with swelling order books of EPC firms are working well.
Thu, 11 Jan 2018 10:28:56 +0530