The stock markets are down, eroding investor wealth by millions of rupees. The markets that have stood against the tides of inflation aren't the mostfavoured today. Those planning for their retirement years may prefer reducing their exposure to stocks and increasing their investments in real estate.
While stocks are also long-term investment vehicles, the returns on real estate have always been remarkable.
For those close to retirement years, planning is crucial . Should your portfolio have an exposure to real estate? Retirement planning spans over a long term. With inflation looming large over your heads, it is essential that your investments yield decent returns that beat the inflation.
Yes, fixed deposits and other debt instruments are an indispensable part of a retirement portfolio. You can also consider exposure of a small portion of your money to the stock markets or mutual funds. To add real estate to this list of investments is a good idea.
Wouldn't it be nice if you had your own roof after retirement, for which you need not dole out monthly rent? Wouldn't it be nice if you had a piece of plot that could be sold anytime to meet unforeseen expenses? An investment in a house not only appreciates with time, but also allows you to enjoy income tax benefits on repayment of the home loan.
Inflation and increasing rates has dampened investor interest. This is a good time to invest in property .
The traditional social fabric has undergone a drastic change. Joint families have shrunk into nuclear families .
Thus, all senior citizens do not have their children's support. It becomes even more important for people to plan for their retirement years. Further, advancements in modern medical science and information about healthy lifestyles have increased life expectancy of people. Inflation has pushed up costs of everything from food grains to transport and healthcare.
It is essential that retired people have ample funds to meet their medical and other regular expenses.
Consider reverse mortgage . Here, a loan is offered to homeowners who are above a certain age, to enable them to convert the market value of their home into cash to finance their needs.
The basic condition is that the property should be self-acquired and selfoccupied . Reverse mortgage can be defined as a form of mortgage in which the lender makes periodic payments to the borrower using the investment in the house as security.
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