Retirement Savings Options for Modest Contributions

This is for anyone trying to keep their KiwiSaver ticking over amongst the chaos of parenthood - or their partner's KiwiSaver (because raising kids is definitely a team sport!). Contributing to your KiwiSaver can feel like a bridge too far when money's tight, whether you're on parental leave, working reduced hours, or down to one income. And frankly, life is busy. I teamed up with Mark White Robinson and Benjamin Davin from Feijoa to pull together six ways you can keep KiwiSaver contributions going. These strategies are about finding small amounts that keep your retirement contributions growing in the background, even when you're too exhausted to think about it. 1. Get the KiwiSaver contribution on PPL. 85% of people don't claim this. 2. Set up a $21-a-week automated contribution, which ensures you the max $260 government contribution each year. 3. Use KiwiSaver round-ups. The average round-up is $2-3 a day, which doesn't sound like much until you realise it's $910 a year. 4. Budget for KiwiSaver in the family budget. Treat it like any other expense, even if it's small. 5. Redirect savings when costs drop. When your kid hits a milestone that saves you money (like toilet training = no more $30/week on nappies), divert some of those savings to KiwiSaver since it's money you were already spending. 6. Convert credit card points into KiwiSaver dollars. This option is only available if your credit card provider and KiwiSaver issuer are the same. I'd love to hear any other strategies that have worked for you. https://lnkd.in/gdNcps5e

If you can no longer contribute to a Roth IRA, don't worry—you still have options. Here are a few strategies to consider: - Backdoor Roth IRA: Make a non-deductible contribution to a traditional IRA and then convert it to a Roth IRA. This is a great way to get around income limits. - Roth 401(k): If your employer offers a Roth 401(k) (vast majority do), consider contributing to it. There's no income limit for contributions, and it offers the same tax-free growth and withdrawals as a Roth IRA - Mega Backdoor Roth 401(k): Contribute to your after-tax 401(k) and then convert the funds to Roth. This strategy allows you to contribute significantly more to your Roth accounts - Taxable Brokerage Account: If you've maxed out your tax-advantaged options, consider investing in a taxable brokerage account. While you won't get the same tax benefits, you can get long term capital gains These options can help you continue building your retirement savings and take advantage of tax-efficient strategies

Investing for Retirement: Here is an age-wise step by step plan for you ⤵️ Retirement planning is like planting a tree—the earlier you start, the more time it has to grow. But even if you’re late to the game, the right strategy can still bear fruit. The key lies in aligning your investments with your age and risk tolerance. I like to break it down by life stages: ▶️ In Your 20s & 30s: Build Your Foundation Goal: Maximise growth with higher risk tolerance. What to do: • Focus on equities: Invest in high-growth assets like stocks or equity mutual funds. • Start small, but be consistent: Even ₹5,000/month can grow into a significant corpus over decades (thanks to compounding!). • Embrace diversification: Explore ETFs, small-cap funds, and international equities for balanced growth. Why it works: Time is on your side. You can afford short-term market volatility for the promise of long-term rewards. ▶️ In Your 40s: Balance Growth & Stability Goal: Shift towards a moderate risk profile while maintaining growth. What to do: • Allocate 60% to equity and 40% to debt instruments like bonds and other non-equity asset classes. • Begin exploring index funds or hybrid funds for a mix of growth and stability. • Don’t forget to top up your EPF or NPS contributions. Pro-Tip: Use the 100-minus-your-age rule to determine the non-equity percentage in your portfolio. ▶️ In Your 50s & Beyond: Secure & Preserve Goal: Focus on wealth preservation while maintaining a steady income. What to do: • Reduce equity exposure to 30-40% and increase allocations to low-risk options like senior citizen savings schemes (SCSS), monthly income plans, or annuities. • Create a Systematic Withdrawal Plan (SWP) for regular retirement income. • Ensure your health insurance is robust to avoid dipping into your retirement corpus. Why it works: As retirement nears, capital protection becomes crucial. Lower-risk instruments ensure stability. ▶️ The One Thing Everyone Should Do: Factor in inflation. A ₹1 crore corpus today won’t hold the same value 20 years later. Ensure your portfolio grows faster than inflation, regardless of your age. Retirement isn’t just about stopping work—it’s about financial freedom to pursue what you love. The earlier you start and the smarter you strategize, the easier it gets. What’s your plan for retirement? Follow me Amar Ambani for more. #TheAmbaniAngle #PersonalFinance #RetirementPlanning #FinancialFreedom

💼 Planning for retirement? Most people ignore the most powerful tool already available in India — the NPS. 📊 Here’s why you can’t afford to overlook it: 🔄 Delivers 8–12% average returns with flexible investment choices 📈 Combines equity growth + government security stability 🏦 Offers up to ₹2 lakh in tax deductions every year under 80C & 80CCD 👤 Lets you customize risk with Active or Auto investment options 💰 Helps build a multi-crore retirement corpus even with small monthly contributions 🔐 Regulated by PFRDA, ensuring security and transparency 📅 Works for freelancers, salaried employees, and business owners alike 💡 My latest research report breaks down how NPS works, where the returns come from, and how to use it to retire rich — backed by data, charts, and 15-year performance trends. 👉 Are you investing smartly for your future or leaving money on the table? Follow Anirban Majee Parth Verma The Valuation School #Valuation #NPS #Management #Investment #Finance #InvestmentBanking

How can I save for retirement if I don’t have a 401(k)? 1️⃣ IRA or Roth IRA → Generally, anyone can contribute up to $7,000 per year to an IRA or Roth IRA. → There are some phaseouts based on income (you may make too much money) and you can’t contribute more than you make, either. → You can choose to use tax-deductible “traditional” IRAs or after-tax Roth IRAs to get a tax break now or later. 2️⃣ Investment Accounts → Just because an investment account isn’t a “retirement account” doesn’t mean you can’t set money aside in it for your retirement. → Anyone can save any amount into an investment account. → These can take different forms and may have their own tax advantages. 3️⃣ Health Savings Account (“HSA”) → Primarily intended as an account to pay medical expenses from. → You can generally save up to $4,150 per year to an HSA for paying medical expenses in retirement or for any reason after age 65. → You can usually invest HSA balances like you can with IRA and investment accounts. Business owners will have additional options, but in general: 1️⃣ IRA or Roth IRA 2️⃣ Investment Accounts 3️⃣ Health Savings Accounts Those are the “go-to” accounts when you’re not covered by employer retirement plans. P.S. Are you up-to-speed on all your retirement saving options?

To spend $100,000 in retirement, some may need to withdraw $140,000+. Others may only need around $105,000. The difference? Not investment returns. The type of accounts they used along the way. This is one of the biggest misconceptions I see with investing. People spend years focusing on picking stocks and chasing return. But often spend very little time thinking about where those investments should actually live. And over time, that decision can create a massive difference in: - Taxes - Flexibility - Withdrawal strategies - Long-term wealth preservation The 4 major account types each behave differently: 1. Traditional IRA / Pre-Tax Accounts These accounts may help reduce taxable income today. That’s why many high earners prioritize them during peak earning years. The tradeoff? Future withdrawals are generally taxed as ordinary income. Which can become important later for people trying to create retirement income efficiently. 2. Roth IRA No upfront deduction. But qualified withdrawals can potentially come out tax-free later. A lot of people underestimate how powerful decades of tax-free growth can become. Especially for younger investors and high earners with long compounding timelines. 3. HSA One of the few accounts with potential triple-tax advantages: 1) Tax deduction going in 2) Tax-free growth 3) Tax-free withdrawals for qualified medical expenses Some people even choose to pay medical expenses out of pocket today, while leaving the HSA invested long term. 4. Taxable Brokerage Accounts No upfront tax break. But a huge amount of flexibility. No early withdrawal penalties. No required distributions. No contribution limits. And in many cases, long-term capital gains rates may be lower than ordinary income tax rates. Which is one reason taxable accounts often become important for people pursuing financial independence before traditional retirement age. Most strong financial plans don’t rely entirely on one account type. They use different accounts strategically together. Because years later, there’s a big difference between: * Needing to withdraw $140,000 to spend $100,000  vs * Needing to withdraw $105,000 to spend $100,000 And that gap often starts long before retirement even begins.

Many Indians have built crores in their provident fund accounts. But if your yearly investment crosses 2.5 lakh rupees, the interest is no longer tax-free. Most people don't know this limit exists. Let me explain EPF, VPF, and PPF simply. All three are government-backed retirement savings accounts. EPF is compulsory for salaried employees. 24% of your basic salary goes in every month. You earn 8.3% per annum. Tax-free. This is the safest fixed instrument in India with the highest interest rate. VPF is the voluntary version. You can add more money on top of your 24% into the same PF account. Same 8.25% interest. Same safety. Most salaried employees don't even know this option exists. PPF is open to everyone. Not just salaried people. It gives 7.1% tax-free interest. Yearly limit is 1.5 lakh rupees. Lower than EPF, but still beats your bank FD if you're in the 30% tax bracket. Now here's the trap. If your EPF plus VPF contribution crosses 2.5 lakh rupees in a year, the interest on the extra amount becomes taxable. Put in 4 lakh? The interest on 1.5 lakh of that gets taxed at your slab rate. So the tax-free benefit has a ceiling. And most people cross it without realizing. Here's how to use all three the right way: 1/ EPF: Let it run. It's automatic. Don't touch it. 2/ VPF: Add more only if your total stays under 2.5 lakh per year. Beyond that, the tax-free benefit shrinks. 3/ PPF: Use this for additional savings up to 1.5 lakh per year. Especially if your EPF already hits the 2.5 lakh mark. All three have a 15-year lock-in. But 100% withdrawal is possible if you're unemployed for 2 months. Partial withdrawals are allowed for medical emergencies, home purchase, or education. The mistake most people make is simple. They either don't know about VPF or they over-contribute past 2.5 lakh without knowing the tax rule. One number changes the entire math. Know it before you invest. Share this with a salaried friend.

If you want to retire with ₹3.27 crore in India, here’s the hard truth: Savings accounts alone won’t cut it. You need a solid plan and the right strategy. Here’s how you can build this corpus step by step: 1) Start with the numbers: If you’re 30 years old and plan to retire by 60, you have 30 years. To reach ₹3.27 crore: You’d need to save and invest ₹15,000–₹20,000 per month in an equity mutual fund with a 12% annual return. Starting later? The amount required will skyrocket due to the lost power of compounding. 2) Choose the right investment tools: - Equity mutual funds or Index funds: Best for long-term growth (average 10-12% annual returns over 15–20 years). - Public Provident Fund (PPF): Great for tax-saving, low-risk (current return ~7.1%), but not sufficient alone. - National Pension Scheme (NPS): Helps diversify between equity and debt. Ideal for retirement planning with additional tax benefits. - SIPs (Systematic Investment Plans): Automate your monthly investments into equity mutual funds to stay disciplined. 3) Don’t underestimate inflation: Today’s ₹3.27 crore might seem huge, but inflation will eat into its value. Assuming 6% inflation, you’ll need ₹3.27 crore to equal about ₹1 crore in today’s value. Plan for an inflation-adjusted retirement corpus to maintain your lifestyle. 4) Control unnecessary expenses: Lifestyle inflation is a silent killer. Instead of upgrading your car or phone frequently, invest the difference. Regularly track your spending with budgeting apps. Every ₹1,000 you invest monthly today can grow to ₹12.5 lakh in 30 years at 12% returns. 5) Insure and diversify: - Health Insurance: Medical costs can wipe out your savings if you aren’t prepared. - Life Insurance: A term plan ensures your family is protected. Avoid putting everything in one basket. Diversify between equity, debt, and gold (5–10% allocation). Each salary increment should translate into higher savings. If you can raise your investment contribution by even 10% every year, you’ll reduce the pressure in your later years. Have you calculated your retirement goal yet? #RetirementPlanning #FinancialFreedom #InvestingTips

Lack of retirement savings increases the risk of severe anxiety or depression among older adults. According to a study published in Current Psychology, older adults without retirement savings were a staggering 3.6 times more likely to experience severe anxiety or depression compared to those with financial security. How can you avoid this? There are steps that you can take today to prepare for this. If you are behind on retirement savings: Consider increasing your contribution rate to tax-advantaged accounts like 401(k)s or IRAs. Even small increases can make a big difference over time thanks to compound growth. If you have maximized your 401(k) contributions for the year: Consider exploring additional tax-advantaged retirement accounts such as: → Traditional or Roth Individual Retirement Accounts (IRAs): In 2024 you can contribute up to $7,000 ($8,000 if age 50 or older) to an IRA each year.) Traditional IRA contributions are tax-deductible, while Roth IRA contributions are made with after-tax dollars but qualified withdrawals in retirement are tax-free. → Health Savings Accounts (HSAs): If you have a qualifying high-deductible health plan: In 2024 if you have a high-deductible health plan, you can contribute up to $4,150 for individual coverage or $8,300 for family coverage (plus $1,000 catch-up contribution if age 55 or older) to an HSA. Contributions are tax-deductible, and the money can be invested and withdrawn tax-free for qualified medical expenses. → Taxable brokerage accounts for long-term investments: You can open a regular brokerage account and invest in stocks, bonds, mutual funds, etc. There are no tax advantages for contributions, but you can believe from potential long-term capital gains treatment on investments held for over a year. The earlier you start saving and the more disciplined you are, the easier it will be to build sufficient retirement savings and avoid the anxiety that comes with financial insecurity later in life. An ounce of preparation is worth a pound of peace of mind and better mental health as you transition into your retirement years. = I’m Marc, a Certified Financial Planner. I help you build & protect wealth. Find my Featured section to learn more.