Plan For Your Retirement – Invest In Real Estate

According to a new report released by the Institute of Economic Affairs (IEA), following an initial boost in health, retirement increases your risk of clinical depression by 40 percent while raising your chances of being diagnosed with a physical condition by 60 percent. It also:

•Reduces your likelihood of being in self-reported excellent or very good health by 40 percent
•Raises your risk of taking medication for a diagnosed physical condition by 60 percent

Another survey suggests that 61 percent working population in India would want to retire in the next five years. However, the retirement age in India for men remains unchanged at 60 in 2017. Having said that, if you are also planning to retire in the next few years, few questions that you need to ask yourself before taking the plunge –

•What fort of lifestyle are you looking at post-retirement?
•Where would you want to live post retirement?
•Longevity factor? Planning to cover expenses for how long?
•Source of income post retirement?

Although a majority of Indian population values retirement savings, however a report by HSBC revealed that 47% of working population have not initiated future savings or discontinued owing to difficulties while saving. Additionally, mostly friends and family are the most common source of information advice for retirement.

Regardless of your age, if you are working, planning retirement savings should be taken care of. It’s never too late or too early to start planning for your retirement. Waiting each day would worsen the situation. Apart from what you save, you need to find an alternate source of regular income to sustain your lifestyle. One can always start looking at investments to put money into after doing proper homework.

One great option is real estate investment- There is always a debate on this subject as to which is a better option for investment. Would you invest your funds in real estate or shares? Both have their own pros and cons. It depends on the investor; a risk-averse would pick real estate over shares while a risk taker would pick shares over real estate. If you belong to the former category, you should invest in real estate.

Real Estate Investment- Real estate is a tangible good; you can touch and feel it. It renders a psychological comfort to the owner. No middlemen, no commission. Unlike stocks, you don’t have to keep a daily check on the value. The real estate is mildly affected by market forces. However stocks need a daily check on the trading points, any fluctuation in market forces would affect the stock price. Post retirement, if you are looking for a regular and steady income, real estate investment is the best pick.

RERA is a welcome step in real estate regulations assuring investors of transparency & accountability.

Retirement property owned after proper analysis can help retirees get a steady and regular income for the post retirement period. Being a long term asset, one can expect the value of the property to go up with an increase in demand. The biggest advantage of investing in real estate is “They don’t make land any more”. The supply is limited and demand is always there.

Other than the ones stated above, here’s why you should consider investing in real estate for post-retirement income:

1. Leverage-Real estate falls under the few investment vehicles wherein acquiring finances for property acquisition is easier. Leverage your capital and increase your return on investment.
2.Income: Real estate gives a return in short-term as well as long-term. Rental income is regular and steady during short term period. During long term, real estate will offer capital appreciation.
3.Secure future: Even the value of Gold doesn’t increase at a scale in which the value of a property hikes. If you have planned to buy a property in INR 20 lakh, be rest assured that the property will give you a return of not less than 40 lakh or 50 lakh in the next 20 to 30 years.
4.Hedges against inflation: No other investments beats inflation like real estate does. If done with proper analysis and calculation, real estate return can outweigh inflation.
5.Tax benefits: If real estate investment was made by availing loan, certain tax deductions can be availed. Apart from this, there are other tax benefits that can be availed.

If you have not yet planned for your retirement- If you don’t have any investment on real estate, do it now! Start analyzing the investment options in real estate and get your retirement plan sorted!

We also can’t ignore the emotional significance of retirement. A man in India always plans to own a property before retirement so that if not sold, one can at least be exempted from the burden of paying rent throughout the working tenure. The pride of owning a property can’t be beaten by anything else. Real Estate Investment is the most logical investment pre-retirement for a lavish post retirement life.