Retirement is a phase in our life that many of us look forward to with great expectations. It’s the time when we hope to enjoy the fruits of our hard work. Most of us want to travel, pursue hobbies, and spend quality time. However, it becomes challenging when our retirement funds fall short of our expectations. With rising living costs, it is crucial to find solutions for a financially-safe retirement.

There are several reasons why retirement funds may fall short of our expectations. One reason is that inflation can erode the value of savings over time. Another reason is health and other financial emergencies that can stretch our retirement savings even further. If your retirement funds are falling short, here are some steps you can take to improve your financial situation.

Start Early and Save More

The sooner you start saving for retirement, the more time your investments have to grow. It’s essential to set aside a significant portion of your income for retirement savings. Utilize tax-advantaged accounts like the Employees’ Provident Fund (EPF), Public Provident Fund (PPF), or the National Pension System (NPS) to maximize your savings.

Adhil Shetty, CEO, Bankbazaar.com, says, “Early investment can help in multiple ways. Beginning early gives you the flexibility to make smaller contributions over a more extended period, reducing the financial burden compared to trying to catch up later in life.”

Also Read: How to grow your PF money to meet your retirement goal

Invest Wisely

Your investment must align your financial goals, including your retirement. When you invest your money, you are putting it to work for you. Over time, your investments should grow in value, which can help you reach your retirement goals.

Diversify Your Investments

Relying solely on traditional savings accounts or fixed deposits may not generate enough returns to keep pace with inflation. Consider diversifying your investment portfolio with a mix of equity, debt, and other asset classes. Mutual funds and exchange-traded funds (ETFs) are popular options that can potentially offer higher returns over the long term.

Reduce Expenses

In the years leading up to retirement, it’s crucial to manage your expenses and avoid unnecessary debt. Living within your means can free up more money for savings and reduce the financial burden in retirement.

Secure Adequate Health Insurance

Medical expenses can be a significant drain on retirement savings. Ensure you have comprehensive health insurance coverage that includes critical illness coverage. This can safeguard your savings from unexpected healthcare costs.

Shetty explains, “Health insurance acts as a financial safety net, covering hospitalisation, surgeries, medication, and critical illness treatments. You also get tax benefits under Section 80D of the Income Tax Act, making health insurance a financially-prudent choice. It provides peace of mind and allows retirees to focus on enjoying their golden years rather than worrying about unforeseen medical bills.”

Post-Retirement Jobs

Many retirees choose to work part-time or pursue passion projects to supplement their retirement income. This can also be helpful in staying active and generate some money.

Don’t Lose Hope

Sometimes your financial needs may be much higher than the funds you may be having. This is the time when you need to stay strong and find a way out of tough situations. It may take some time and effort, but it is possible to overcome financial challenges in retirement. Don’t give up on your dreams of a comfortable and secure retirement.

Some people star their retirement planning too early while others feel they are too late to even start. You must remember that there is no good or bad time to start planning your retirement. However, the early you start, the early you will start seeing the benefits of your investment planning. You must remember that retirement planning is important, but it is never too late to start. By acting now, you can increase your chances of having a comfortable retirement.