Financial Planning: 4 Data Points You Must Get Right or Your Plan Fails!

• Incorrect estimates for inflation, investment returns, life expectancy, and income growth are the biggest risks in financial planning.
• Inflation: A 2-3% difference in inflation estimates can drastically alter long-term expenses; historical Indian retail inflation averages around 6%.
• Investment Returns: While Nifty 50 TRI shows good long-term returns, actual portfolio returns may be lower due to conservative asset allocation near goals.
• Life Expectancy: Underestimating life span leads to insufficient retirement savings; planning for 80, 85, or 90 years significantly changes required corpus.
• Income Growth: Often overestimated at 10% annually; actual growth varies, making conservative estimates crucial for savings.

Why It Matters: Accurate estimation of inflation, returns, life expectancy, and income growth is vital for successful financial planning.