With change in lifestyle and rise in prices of essential items, maintaining monthly finances has become very crucial.

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While you are looking at "monthly finances" do not forget to look at long term finances. Here we are talking about "post retirement life".

Ideally, a person start working at the age 21 and look for retirement by 60. In this 39 years of life span, there are sea of expenses which incurs including higher education loan, wedding expenses, health related expenses and various others.

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Amid all this, do not forget to "secure" your post retirement life. How to do that?

Speaking with Zeebiz, Ajit Narasimhan, Category Head - Savings and Investments, BankBazaar.com, said that the best age to start thinking about retirement is when you start working in your 20s. At that point, retirement is a long way off, and doesn’t seem worth bothering about. However, it is also the time when your responsibilities are fewer and with a little effort, you can save a great deal more than say in your 30s when you have the responsibilities of a family with all the associated expenses of home loans, car loans, children’s schooling expenses, etc. So putting aside a dedicated amount every month to build up a retirement corpus right from your 20s is a good idea."

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How to create retirement corpus?

Investing in equity allows investors to beat inflation in the long terms, and Mutual Funds are the safest and best way to invest in the market. Equity funds in India have generated close 15-17% CAGR over the past 10 years. That’s about 8-9% above inflation. When you compound this annually, this gives you a significant amount of wealth over an extended period of time.

Split your retirement corpus between Debt and Equity Mutual Funds depending on your risk appetite and time horizon. Ideal post retirement split can be 70% debt and 30% equity.

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Fixed deposits (FDs) is an ideal investment option for an investor who is looking at fixed and assured regular income. It’s a very good senior citizen’s product. 

However, FDs are more of a savings product than an investment product. Net of tax, the real return from fixed deposits tend to be lower than inflation at most times. So, while FDs can be a part of your investment, they cannot be enough if you want to build an inflation-proof retirement corpus.

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So, start savings from today and create a corpus to live a peaceful post retirement life!