Follow 4 proven steps to plan for an early retirement

It is a persistent question on everyone’s mind. How much I need to save per month for a stress-free & early retirement? Am I saving enough? What should be the ideal expense to savings ratio? Follow these 4 simple steps in order to plan for your retirement savings and achieve financial independence:

  • Track Current Expenses (CE)

It is a first step towards any sound financial planning and particularly so in planning for retirement. Without knowledge of your current expenses (CE), it is almost impossible to understand what sort of annual or monthly budget would be required few decades down the line. More so it is difficult to judge how much of saving is possible without understanding the outflow.

You may be able to identify extravagant expenses & make appropriate cuts in your CE to clinch that goal of early retirement. These days there are variety of apps available, such as Finart, to help you automatically track and categorize your spending.

  • Determine Cost of Living (CoL)

Cost of Living is a subjective term and depends on your city & lifestyle. But it can be crudely defined as the expenses required for bare necessities such as house, groceries, transport etc.

  • If you are supporting a family, it will also include their expenses such as Children’s school fees etc.
  • If you have incurred any major expense such as buying a TV or a vacation, average it over a year and include it in CoL This is assuming that you will be expecting such expenses over a foreseeable period of time

Use your discretion to filter through your current expenses (CE) over last few months to come up with a final CoL number.  This is a non-negotiable amount which you will require month-over-month.

  • Determine Ideal Income-Savings Ratio (IISR)

This can make or break your early retirement plan. So spend some quality time to determine your Ideal Income-Savings Ratio (IISR). There is no golden IISR which can be applied to all. But you can come up with the ratio which is just right for you by making use of CE & CoL numbers obtained in previous steps. Compare your cost of living or CoL with your income & follow these rules of thumb:

  1. Your cost of living (CoL) consumes a significant portion of your income (e.g. between 60-100%) It becomes rather difficult to do reasonable savings. In this case, make sure you save at least 10% of income even if it requires some cuts in your current expenses and/or CoL. If you can do more savings, the better. Do not allocate budget for any luxury/discretionary spending until you are saving at least 25% of your income.
  2. Your cost of living is much less than income (e.g. 40% or below) It indicates you are in a higher income bracket relative to your CoL. In this case target a saving of 40% or more of your income as you can afford to do the same. This will still leave a room of about 10% for your luxury/discretionary spending  to improve your quality of life.


  • Right Investment Instruments

Let’s say you want to continue with your current lifestyle in your retirement period as well. An intuitive estimate is if you save as much as your expenses from today onward, you will be able to enjoy as many years of retired life as the remainder of your working years.

But this is based on assumption that the instrument of your investment is close to inflation index in your country. For example, If the inflation  in your country is close to 10%, you need to target an investments which can give at least similar returns. Keep in mind that returns have to be post-tax.

Let’s say a long-term fixed deposit gives close to 6% p.a. post tax You might want to split the investments into some high-gain medium-risk mutual funds which are giving close to 15% per annum. Look for their historical performance. Bear in mind that there is always some risk involved but it will ensure that your corpus does not decrease in value day-by-day.

If you have entrepreneurial gene, here is the bonus tip to plan your retirement on your own terms.

  • Own a Business Stake

You won’t get rich renting out your time. You must own a stake in a business to earn your financial freedom. But a business stake is not easier to get, you have to take accountability and take risks. Renting out your time to someone can earn you money but not wealth (leaving some thoughts to ponder). Take your 2019 plunge to create wealth for yourself and for everyone around you.

How to Get Out of Debt – A simple 6 Step 2019 Guide

A Debt trap is not a good thing. We can relate to the struggle to get out of it. It requires a conscious and focused effort of making a list, tracking your expenses, consolidating the debts and making changes in your spending so that you do not splurge more than your income.

What is the best way to get out of Debt?

Getting out of debt requires discipline. At multiple levels. You will need to be disciplined in your spending, disciplined in paying your bills on time and disciplined to follow through the steps outlined here.

We have given below a six-step guide to help you get out of debt as fast as possible:

1. Finish off Smaller Debts First 

Every debt has a string of charges involved starting with the interest on loan money, processing fees, pre-payment charges & so on. Not to mention the burden of maintaining a debt account, tracking the due dates and making the payment. Hence if you have multiple debts, make a list of all of them and sort in the increasing order of pending amount. Thereafter look at the top 1 or 2 debts to see if you can quickly close them in a few months by making more than required payments.

2. Consolidate when possible

Multiple loans are difficult to track, just like multiple credit cards. And if you missed any one of the due dates, you will be slapped with severe late payment and finance charges + taxes. In order to avoid that, explore if you can consolidate your debts at one or two places. This applies more to items which are towards the bottom of the list created in step 1. You can either avail more loan from one of the sources to pay off the others or opt for outstanding balance transfer facility available for some financial institutions.

3. Switch to lower rates

There is stiff competition in the loan market. Banks and NBFCs are trying to outbid each other in order to acquire more customers. There is always one or the other new schemes which can lower your interest rates. Keep an eye out to see if it can benefit you substantially. But also bear in mind the processing fees involved . Also dont do it too frequently or when the loan is nearing the end as it will lead to unnecessary botheration without significant financial benefit.

4. Track your Expenses

Next step is to start tracking your expenses. It is a sound financial practice and more so if you are in a debt trap. Tracking expenses will help you understand the difference between your expenses and income, which is the amount you can split between savings and payment of your debt. These days there are many apps available which simplify the task of tracking expenses. They also provide an idea of your average monthly expenses and also which category is consuming most of your budget. Among those apps, Finart is worth mentioning. It is simple, secure and easy to use. Keep a budget for each category as well as an overall monthly budget

5. Never pay late payment or Finance Charges

When you have multiple debts, it also means multiple due dates and bills. Failing to pay the EMI or minimum amount due can result in serious charges which can derail your recovery process. Make a list and ensure that you are never late for any payment due to negligence. Set reminders or use apps such as Finart to give you automatic due date reminders.

6. Continue to Save a Minimum Amount

Whenever you have a positive difference between income and expenses, you may be tempted to use the full amount for paying your debt. This may not be completely wise. Always keep a certain amount of saving fund or an emergency fund which can be used in unforeseen circumstances. We recommend it to be at least 10% of your income. Use the remaining amount to prepay your debts.

Once you are fairly our of debt, checkout this advice on living a debt free life

Check your SBI account balance using toll free enquiry

There are many occasions when you may want to know your State bank of India (SBI) bank balance. For e.g you may want to make sure that you have sufficient balance to cater to your scheduled auto debits or someone might have deposited money in your account and you just want to make sure its credited in your account. The days are gone when you had to visit SBI branch or ATM to check SBI account balance, now with mobile phones everything (including account balance) is available on your tips.

SBI has been traditionally known to provide legacy systems and leaving the needs of digital savvy customers. unaddressed. But in recent year, SBI has been adopting latest and relevant tools to offer excellent customer service. SBI toll-free balance enquiry is one of the easiest and quickest methods to check your SBI account balance without visiting your SBI branch or ATM.

SBI enquiry using toll free number

SBI has setup a state-of-the-art IVRS system to provide key services from the comfort of your home. IVRS enables you to use a toll free number to avail multiple services including account balance enquiry. To use the IVRS service to check your account balance, you can follow either of these 2 options:
1. Give a missed call to 09223766666 from your mobile number which is registered for this service.
2. Send a SMS in following format to 09223766666 from your mobile number which is registered for this service.
SMS Format: ‘BAL’

SBI will send a SMS with account balance information to your registered mobile number.

If you are not sure if your mobile number is registered for toll-free service, you can check it by simply dialing 09223766666 number. If your number is registered, then you will receive your account balance information in a SMS otherwise your call will be simply ignored by the IVRS system. You can register your mobile number by following simple one time registration process. You just need to send SMS ‘REG<space>Account Number’ to 09223488888 e.g. REG 2233445566

Check bank balance using ATM

Apart from toll-free service, you can also check your account balance using your ATM-cum-debit card. You need to visit a State Bank of India ATM and follow these steps:
Swipe the SBI ATM-cum-debit card
Enter your 4-digit ATM PIN
Choose the “Balance Enquiry” option

ATM will display the account balance on screen and also provide a print option so you can take it for your record. You can also visit non-SBI or other bank’ ATM service to check your account balance. But please note that RBI has limited the total number of free transactions per ATM/debit card. Balance enquiry is also counted as one transaction towards this limit. If you cross this monthly limit of free transactions, you will have to pay transaction charges. The number of transactions is inclusive of the ones you carry out at any ATM whether it is an SBI or a non-SBI bank ATM. This is one of the main reasons why you should do your balance enquiry online and reserve the ATM transactions for cash withdrawal only.

You can also find more details on different options for account balance enquiry on SBI website