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How you can live your retirement in style

By Rajiv Raj
July 10, 2015 12:15 IST
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Just avoid these credit card mistakes and live your second innings in style, says Rajiv Raj

After having worked hard all your life, the one thing you want to look forward to is a peaceful retirement. As the golden years set in, you should be preparing to play a second innings in style. The last thing you should be bothering about at these times is money matters.

If you make financial blunders when you are in your prime, you may be denied money when you need it the most. The following are the credit mistakes you should avoid in order to live a stress free retirement.

Manage your debt responsibly

It's great to want to live a debt free life, but in this day and age, it's quite a tall task. What's more, it does not really augur well for you, when you really need a loan. In the world that we live in today, lenders will go through your CIBIL report to see your credit history. If you have no credit or only a single credit, they will interpret it as extreme aversion to risk, and will be unwilling to give you those loans you need.

The right thing to do therefore is to have a good mix of credit (secured and unsecured loans) and make timely repayments of the same. This will reflect in your CIBIL report and you will end up having a high CIBIL score.

Don't bite off more than you can chew

Just because everything is available on credit today, does not mean you need to have everything. It's good to be aspirational, but make sure you do not find yourself struggling under a huge debt pile at any given time.

Loans and credit cards should be taken according to your needs. If your debt goes out of hand you can be in trouble trying to repay it all. Chalk out your financial goals in a manner that you can make timely payments in phases and retire peacefully.

Keep an eye on your CIBIL Score

This is the most important aspect of managing your finances today. CIBIL is the oldest credit bureau in India and all the credit institutions contribute credit data on their borrowers to CIBIL on a monthly basis. Your credit report is generated by CIBIL basis information received from various lenders.

They will also assign you a credit score based on your credit profile in the Bureau. Sometimes because of some discrepancies on behalf of the lender, wrong data may be fed in, and there may even be cases of a mistaken identity.

This means a loan you may not have taken may show up against your name. If you remain ignorant, this will keep reflecting badly on your credit score, and you may be deprived of your dues.

It is therefore most important for you to check your CIBIL report at least once annually and make the rectifications if necessary.

Avoiding these crucial mistakes when you are in your prime and planning out your financial goals will lead to a peaceful retirement. If you plan well you will be able to enjoy life at its fullest when you are relieved of your responsibilities.

Illustration: Uttam Ghosh/

The author is a credit expert with 10 years of experience in personal finance and consumer banking industry and another 7 years in credit bureau sector. Rajiv was instrumental in setting up India's first credit bureau, Credit Information Bureau (India) Limited (CIBIL). He has also worked with Citibank, Canara Bank, HDFC Bank, IDBI Bank and Experian in various capacities.

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Rajiv Raj