Connect with us


Retirement Planning 101



It may sound too early but thinking about your retirement plan should be done as early as now.

Planning for your retirement may sound tedious, but with proper planning and assessing of your financial goals, it will be easy.

Here’s a comprehensive guide on how to start your retirement planning.


During your 20s is the best time to start your financial foundation since you are just starting your career.

Start saving

As soon as you get your first paycheck, allot a small amount for your savings. Open a bank account solely for your savings. This could be for down payment for your car or house and lot.

Build your emergency fund

Just like with your savings, start building your emergency fund as soon as you start your career. Allot 10% to 15% of your salary to your emergency fund. You can also open a bank account for this so you won’t be able to touch it.

Be financially literate

Achieving financial freedom is not only based on how much you are earning. You should also be able to know how to manage your money well.

Read finance books and attend financial talk or workshops to strengthen your knowledge about the right and efficient financial planning.

Buy an insurance

In your 20s is the best time to buy a life or health insurance since you have less risky compared when you get older. Hence, insurance premium in this stage is more affordable.

You may opt to buy an insurance with investment so you are protected and be able to grow your money at the same time.

Start 401(k)

Start your retirement fund by allotting 10% of your income.


During this stage, you should have now a solid foundation in savings and should start to have a passive income.

Avoid debt

Avoid debt as much as possible. If not, make sure to choose a loan product that has a low interest rate and good payment terms.

Invest in mutual funds

Start having a diversified portfolio by investing in different investment vehicles. Invest your spare money to mutual funds. Make sure to know your risk profile first before investing so your fund is aligned with your profile and goal.

Look for other source of income

Have other source of income aside from your job. If you have a hobby, such as baking or photography, make money out of it.

Start the college fund of your kids

As early as in your 30s, start funding the education of your children. You can open a bank account for this. You may also choose to buy an insurance solely for the educational fund.

Continue funding 401(k)

Increase your retirement account by allotting 12% to 15% of your income.


By 40, you are more established in life. Your finances should reflect this.

Maximize your savings

You should be able to allot more to your savings. You should have at least twice your income saved.

Eliminate your debt

By this time, you should have not any outstanding debt. Knock out car loan or home mortgage by this age.


Max out retirement options

You can meet a financial adviser to help you with other retirement options and keep you track on your retirement goals.

Review your will and life insurance

Revisit your will and life insurance if it still reflects your current situation and wishes. Make necessary changes if needed.

Retirement planning is not done overnight. It takes a careful planning, discipline, and motivation to do this financial goal.

Hit all these money milestones in every decade of your life and achieve a fruitful and wealthier retirement.