A well planned, stress free and well provided for retirement is something we all aspire to achieve. Until the appropriate age is reached, we work hard to save enough and invest in the right instruments that provide good returns with nominal to zero financial risk. To build the required corpus, the longest tenure is opted for. As the saved or invested sum earns interest at the rate specified and/or applicable based on market and economic conditions, the same is liable for taxation. These deductions can take a toll on the earnings and eventually affect the retirement corpus.
To avoid the harmful effects of taxation, there are several ways how these taxes can be avoided. Listed below are a few of such ways:
The maximum interest income can be earned by investing in a fixed deposit for senior citizens of NBFCs as they provide returns of the range of 8.10%.
So, by making the right investment choices, finances for retirement will take good shape until the time they will be required for use.
Learn more on this subject by following the resource given below: How Senior Citizens Can Make the Most of Tax Breaks on Offer
Retirement planning is mostly about saving and investing in the right financial instruments so that the lack of a regular source of income will not affect the lifestyle of the individual under question and those dependent on him/her. By making the right investment choices, an individual can make sure that after retirement, he/she is financially stable, independent and trouble-free.
Given below are a few important things that need to be taken care of when planning for retirement:
Reviewing Expenses and Calculating the Amount Needed
Budgeting is the starting point for any type of financial planning and retirement is no exception here. Individuals should make a budget, clearly listing the projected expenses of the future- here, both major and minor expenses should be listed. This will give an idea of the tentative amount to be saved until retirement in order to lead a convenient life.
Factoring in Risk
Whenever there is money, there is usually some amount of risk associated with it. This is why one should take utmost care to minimize the risk and work on ways to keep the funds safe and secure until retirement. Individuals should invest more in options like fixed deposits for senior citizens which are much safer as compared to market related investments.
Building an Emergency Corpus
Apart from the regular expenses, retirement could also bring unforeseen expenses. For these, an emergency corpus should be built so that the funds saved for regular expenses need not be used up. An emergency fund will help in avoiding situations that could make an individual financially vulnerable.
Also Read :- Protect your Retirement Funds from Tax
Availing Professional Advice Whenever Necessary
Tax savings, investment options, expenses- professional advice in these aspects will help in making financial planning for retirement more managed and effective.
By implementing these simple steps, an individual can work towards a comfortable retirement without having to worry about lack of funds and emergency situations.
The resource given below lists the additional ways how retirement planning can be made even better: Smart Financial Moves to Make if you Going to Retire
An investor who had invested in a fixed deposit scheme should and must appoint a nominee who could take the custody of the money till the maturity if something happens to the FD holder. Yes, a nominee will get FD money on your demise!
Yes, there are numerous cases in India where you would see brothers, sisters and children and other relatives of an FD account holder fighting for the claim of the money.
Usually, people think that they will appoint a nominee after a while after opening an FD (Fixed Deposit) and time flies. Months turn into years, and in such cases, if something happens to an FD holder, the flight for the claim of the FD money begins.
That’s where the importance of a nominee matters much. Appointing a nominee also means that an account holder need not worry much as even after his/her death, the money will be taken care.
Who is an FD nominee?
A nominee is the guardian or custodian of a fixed deposit account. The task of a nominee is to take charge of the account if anything happens to you.
The name of a nominee is mentioned at the time of opening of the fixed deposit account. It’s not important for the nominee to be related blood wise to an applicant, but should be a sensible person who can take charge of the FD in an un-favourable situation.
People usually make their wife, husband, mother, father, children, and siblings as nominees.
The importance and role of an FD nominee
Let’s provide you the importance and role of an FD nominee in brief:
1. He/she is a custodian
A nominee is the custodian, guardian or an in charge of the fixed deposit account in your absence. However, a nominee has no role to play whatsoever if you are still alive.
2. Responsible for an FD account in your absence
If any matter (legal or more) related to the fixed deposit happens when the FD holder is no longer present in the city of the conflict, a nominee can take charge in this regard. If an FD holder is no longer alive before the maturity has completed, a nominee needs to complete the documentation and collect the amount after the maturity.
3. He/she is also the ‘go to’ person
Anyone can contact a nominee regarding any matter related to an FD if the FD holder is unavailable. The unavailability of an FD holder could either be due to geographical constraints or due to the passing away of the fixed deposit account holder.
Why is an FD nominee so important?
Picture this! You are no longer in this world, and your relatives are fighting over a piece of money that you have in your fixed deposit account. Will you like this situation to happen in your house? No right?
That’s where the appointment of a nominee holds so much value as it helps in maintaining the peace in your family after your demise. Any tussle when it comes to the claims of the FD amount can lead to confusion and bitterness, and a nominee can nullify all such.
The Bottom Line
Life is unpredictable, and you never know what may happen to you next moment! Thus, for all your invested money to reach its correct hands should be your duty, if no longer survive. Appointing a fixed deposit nominee can solve all such issues with ease.
Thus, if you are set to open an FD, make it a point to appoint a nominee.
Even if you have invested in an FD some years back and yet not have a nominee, it is the time to do it right away!
Also Read :- Complete Guide to Investing
Aman is working in the domain of Investment management in one of the top universities. He has published research papers and case studies in Investment and Fixed Deposit marketplace. He is an avid blogger in the domain of Investment management. you can also find him on social networking platforms.