Stage 4: Financial Freedom after Retirement

Now as your children are financially independent, you have more time to spend time with your family. Your investments by this stage would start yielding dividends and interests. Yes, inflation is a concern but you don’t want to outlive your net worth. Keep in mind that - for you and your spouse, long term health care needs must be met.

Know Where You Stand

At this stage, that is after you are retire from your job, analyze where you are standing and start reducing lifestyle expenses to a sustainable limit so that you survive your wealth.

Your Contingency Fund

You should have a separate contingency fund set aside only for health emergencies. This can be of a few lakh rupees, so that it can be used to supplement your health insurance in times of any medical emergency.

Your Asset Allocation

Check that your invested assets at this stage should not be at any risk. After whatever wealth you have built, don’t take any further risk. Rather you can consider opting for a reverse mortgage on your home or taking a minimal equity exposure, just like a monthly income plan or balanced fund.

Insurance

There are not many insurance options for senior citizens. You can continue with your existing health insurance policy. If your health policy is not suitable to you, then you can consider switching your health insurance.