What should be the first thing you do when you start earning? If I say that you should start investing for your retirement, you might as well send me for a toss. However, the right time to invest is when you start earning. The more you delay your investments, the less will be your returns. Secondly, you do not have many responsibilities when you take up your first job. Hence, you can afford to invest a higher amount in the earlier stages of your life. Let us now divide the different stages in your life and see how to manage the investments accordingly.

  • Age 25 to 35 – The Protection Stage

This age is the ideal time for investing. You have settled down into your job. You do not have many responsibilities as you would be single for a significant portion of this stage in your life. Unless you have a student loan to repay, you can allocate a major part of your income towards investment. Refrain from incurring credit card and personal loan debts. This period is also the right time to invest in property. You build up an asset while saving a lot of money by way of income tax concessions.

You should also consider opting for a health insurance plan. It is also the ideal time to purchase a term insurance policy as your premium will be low. Once you marry and settle down in life, you should invest in a health insurance plan that includes your family, and ageing parents as well. It is also better to go for an income protection cover. Set aside a sum every month for investing in SIPs. Such small investments can get you tremendous returns at the time of maturity.

  • Ages 35 to 50 – The Accumulation Stage

This stage in life is the time you accumulate your savings. Your income increases during this period. However, your responsibilities increase as well. You have to cater to the educational expenses of your children. Hence, it is better to start saving early. You will be able to manage your outflow better during this crucial phase in your life.

It is also the time when you should consider repaying your loans one by one so that you do not end up with a massive liability as you approach the age of your retirement. It is advisable to revisit your assets, revalue them and juggle them so that you end up multiplying your investments.

  • Ages 50 to 65 – The Distribution Stage

As you cross the age of 50 years, you find that your family is becoming more independent than ever. Your earnings are at your peak. Since you have started investing early in life, it is time to enjoy the fruits of your investments. You can use this money to clear off your existing debts such as home loan and so on.

Invest your retirement funds in schemes that give you monthly returns. This amount can help you, especially if you do not have a monthly pension. Finally, you should prepare your will so that your inheritors should not face any issues in the future.

  • Final Words

We have seen the three different stages of life that require you to adopt different methods of managing your investments. We can sum up by stating that you should start your investments as early as possible in life. You not only invest less but also end up with a more significant corpus.