Six steps to protect your retirement funds

By scrimping and saving your whole life for retirement, you need to make sure those funds are kept safe for your future needs. Here are a few tips on how to protect your retirement funds:

1. Watch out for frauds

Make sure you aren't involving yourself in a free lunch scam. Every time you think of investing in a fund, look out for any guarantees that you would make a high return on your investment with low risks. That is a warning sign of a theft!

Markets fluctuate, so it is nearly impossible to always expect. Seek out a money manager that is reputable and has a good track record. A money manager is most likely to do clear-cut research on your needs, but make sure you educate yourself and get familiarised with where you want to invest your money.

The author is chief evangelist, Perfios.com

2. Avoid pulling out your money

Market fluctuations are normal, so if there is a drop do not go rushing to pull out your hard earned funds when markets are down. Distract yourself and find something else to do with your time. Track your funds at least once a month. Use financial planning softwares available online to help you manage a well-diversified portfolio. Do not pull out money from your retirement funds, this will just result in less money in the long run.

3. Review your asset allocation

The idea is that as you grow older, you need to review your investments in terms of stocks and bonds. If you have no idea how to go about allocating investments, a good rule of thumb is to invest your age in bonds and the remaining in stocks.

For example, if you are 65, then allocate 65 per cent of your funds to the bond markets and the remaining to stock markets.

4. Check your contributions to your retirement fund

Make sure you are regular and do not go below your minimum contribution amount when its time to pitch in that monthly savings. Small drops make a big ocean, and your retirement pool needs to be big enough to be able to sustain your lifestyle.

5. Watch your spending budget

Be frugal and be smart. Things are not getting cheaper and you need to still look out for good deals while shopping for your necessities.Tax rates are increasing, so make sure your wallet grows in the same pace to sustain the same and a better lifestyle.

6. Plan on working longer

If you are currently reaching retirement age, and are facing a very hectic work-life, maybe it is time to either continue it or consider slowing down by taking up another career! It could be anything from starting a business to taking up a position with lesser responsibilities. 

Look at it this way, you will enjoy what you are doing and earn money by being productive with your time!