Financial Planning
How can a goal-based investment plan help you retire early?
Key Takeaways:
- Early retirement is possible when you invest with clear goals, not random savings.
- Set timelines and amounts for each goal to give your money specific direction.
- Start with equity investments early, then shift to safer options as retirement nears.
- Keep your retirement fund separate to avoid using it for other expenses.
- Retirement starts when your money sustains you, not when you turn 60.
Let’s talk about early retirement. Sounds dreamy, right?
Waking up without an alarm, spending your days travelling, starting that passion project, or just sipping tea at 10 am without checking emails.
But here’s the thing — early retirement isn’t just for the super-rich or lottery winners.
It’s 100% possible for regular folks, too.
The secret? Goal-based investing.
Not random saving. Not blind SIPs. Not last-minute panic investing at 45. But clear, focused, step-by-step goal-based investment planning.
First, why doesn’t random saving work
Most people save like this:
- Put some money in FDs.
- Do a couple of SIPs here and there.
- Maybe buy insurance (because the agent was pushy).
- And then hope it’s enough when they turn 60.
But when you actually sit down and calculate, you realize:
- It’s not growing fast enough to beat inflation.
- It’s scattered, with no clear purpose.
- And it’s definitely not enough if you want to retire at 50, not 60.
This is why people who save “randomly” often end up working longer than they want to.
So, what’s goal-based investing?
Think of it like this:
You’re building different boxes for different dreams.
- One box for your child’s education
- One box for your home loan prepayment
- One box for that Goa retirement villa
And most importantly…
- One big box called "Retire Early Fund"
Each goal has:
- A timeline (when you’ll need the money)
- A target amount (adjusted for future inflation)
- A specific investment plan (suited to how far or near that goal is)
So instead of putting all your money in one generic "savings" pile, you’re actually directing your money with purpose. And that’s what accelerates your journey to early retirement.
How much do you need to retire early?
Let’s do a simple, real-world calculation. Say you are 30 and want to retire at 50, and your current monthly expenses are ₹50,000.
Post-retirement, you’ll still need that amount to maintain your lifestyle, right?
But expenses will grow due to inflation. So, by the time you’re 50, your ₹50,000 today could become ₹1.6 lakh per month (assuming 6% inflation).
Now, retirement experts suggest you need at least 25x your annual expenses saved up to retire comfortably.
Here’s a table to show how that looks:
| Monthly Expense (Today) | Monthly Need at 50 (future inflated) | Target Retirement Corpus Needed |
|---|---|---|
| ₹50,000 | ₹1.6 lakh | ₹4.8 crore |
| ₹75,000 | ₹2.4 lakh | ₹7.2 crore |
| ₹1 lakh | ₹3.2 lakh | ₹9.6 crore |
For illustration purpose only. Actual retirement needs vary on individual lifestyle and personal circumstances. | ||
So, to retire at 50 with ₹1.6 lakh/month spending, you’ll need around ₹4.8 crore. This is your goal.
How goal-based investing helps you get there faster
Now, here’s the beauty of goal-based investing:
It matches your plan to your timeline.
If you start at 30 and want to retire by 50 (20 years to save), here’s how the numbers break down:
| Goal Corpus | Monthly Investment Needed (assuming 12% return) | |
|---|---|---|
| ~ ₹4.8 crore | ~ ₹48,000 per month | |
| ~ ₹7.2 crore | ~ ₹72,000 per month | |
| ~ ₹9.6 crore | ~ ₹96,000 per month | |
For illustration purpose only. | ||
You just need to commit to a ₹48-96k monthly investment consistently for 20 years.
And with goal-based investing:
- You’ll put your retirement fund mostly in Equity Funds early on (high growth)
- And slowly shift to safer Debt Funds as you near 50 (to protect the corpus)
This strategy helps you grow wealth faster early on and preserve it later.
Unlike random saving, which either grows too slowly or stays risky till the end.
Separate your early retirement fund from other goals
This is where many people trip up.
They mix their retirement goal with:
- Their child’s education fund
- Their home loan payoff plan
- Their vacation savings
Result? By 45, they realize they’ve dipped into their retirement kitty for other expenses.
Goal-based investing solves this:
You create a dedicated, untouched “Retire Early” fund.
It grows quietly in the background while you handle other life goals separately.
That discipline gets you to early retirement, while others are still troubled by EMIs.
Why early retirement needs aggressive but smart investing
You have time for moderate returns if you want to retire at 60. But if you’re aiming for 50 or 45?
You need higher returns in the early years, meaning equity-heavy investing.
Here’s how your asset mix typically looks in goal-based planning:
| Years to Retirement | Equity (%) | Debt (%) | Reason |
|---|---|---|---|
| 15-20 years | 80% | 20% | Maximize growth, ride volatility |
| 10-15 years | 70% | 30% | Balance growth and safety |
| 5-10 years | 50% | 50% | Start protecting the corpus |
| Less than 5 years | 30% | 70% | Focus on capital safety |
For illustration purpose only. | |||
This glide path is what makes early retirement possible.
You grow fast early on, then shift gears to protect what you’ve built.
Break your goal into mini-goals
Instead of focusing on that big ₹5 crore figure, break it into bite-sized chunks:
| Goal | Estimated Cost | Time Horizon | Investment Type |
|---|---|---|---|
| Emergency fund (1 year expenses) | ₹7–10 lakhs | Immediate | Liquid fund, FD |
| Basic retirement income (₹35k/mo) | ₹2 crore | 20 years | Equity funds |
| Healthcare buffer | ₹30–50 lakhs | 20 years | Hybrid funds, health cover |
| Travel bucket post-retirement | ₹25 lakhs | 20 years | Balanced advantage funds |
For illustration purpose only. | |||
Each goal has a timeline and a strategy. You’re not just saving—you’re planning with purpose.
Invest in the right mix
For early retirement, you need your money to work harder, especially in the first 10–15 years of your career.
Some options:
- Equity funds (great for long-term growth)
- Index funds or ETFs (low cost, good compounding)
- SIPs (easy and disciplined)
- NPS or retirement-focused plans (for tax benefits)
- REITs or rental properties (for passive income)
And as you near your retirement age, shift some of that money into low-risk debt options. This reduces the impact of market volatility when you actually need to withdraw.
Final thoughts: Retirement isn't an age — it's a number
Here’s the mindset shift you need:
Retirement isn’t when you hit 60 — it’s when your money can support your lifestyle without needing to work.
And goal-based investing is your roadmap to that number.
So, if you’re serious about retiring early:
- Define your retirement goal amount today
- Start a dedicated investment plan just for that
- Stick to the plan (no dipping in for other things)
- Review and adjust once a year
It’s not flashy. It’s not complicated. But it works — every single time.
Because someday, when you finally log out of your work email at 50 and book that one-way ticket to Bali or Himachal? You’ll thank your younger self for starting that goal-based plan today.
Retire early? Yes. And do it in style.
Disclaimer: This article is intended solely for informational purposes. The views expressed in this article are personal. Axis Bank and/or the author shall not be liable for any direct or indirect loss or liability incurred by the reader arising from reliance on the content herein. Readers are advised to consult a qualified financial advisor before making any financial decisions. Axis Bank does not endorse or guarantee the accuracy of any third-party content or links included in this article.
Mutual Fund investments are subject to market risk. Please read all scheme-related documents carefully. Axis Bank Ltd. is acting as an AMFI registered MF Distributor (ARN code: ARN-0019). Any purchase of Mutual Funds by Axis Bank’s customer(s) is purely voluntary and not linked to availment of any other facility from the Bank. This content is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future returns. Readers are advised to consult a qualified financial advisor before making any investment decisions. Terms and Conditions apply.
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