Nine out of 10 Indians are concerned that their savings may not last through their retired life, while over 50 percent believe that their kitty will be exhausted within 10 years, a Max Life Insurance survey has found.
According to the company’s ratings, India's Retirement Index stands at 44, with health and financial preparedness being key retirement concerns. The index, arrived at by the company’s study, indicates the degree to which Indians feel prepared for tomorrow’s retired life on a scale of zero to 100. “It helps assess how prepared India is for a healthy, peaceful and financially independent post-retirement life,” Max Life said in its study. The country’s ‘Financial Preparedness Index’ is at 50.
Health, money key to peaceful retired life
A majority of those polled – 63 percent – say that health will be the most important aspect for them to take care of during their retirement years. Nearly 29 percent said money will be most critical for retired life.
Termed the India Retirement Index study, the study polled 1,816 respondents across 21 metros, Tier 1 and Tier 2 towns Delhi, Mumbai, Bengaluru, Chennai, Pune, Kolkata, Rajkot and Chandigarh.
Despite the concerns around retirement, nearly 23 percent have not even given a thought to retirement planning.
Late realisation on retirement planning
Over a quarter of those polled feel retirement planning should start before the age of 35, while 21 percent feel 36-50 years is the ideal age-group to start. Yet, it does not figure amongst the top goals of investing or saving. Of those polled, only two out of five invest towards retirement, the survey findings said. “India is procrastinating on retirement. (While Indians are) positively inclined towards retirement, (they are) high on realization, low on action,” the study noted. Only when they inch closer to retirement does the realisation seem to hit them – 80 percent of the respondents over the age of 50 admitted that they ought to have started investing for retirement much earlier.
Financial freedom, medical expenses drive retirement planning
Amongst those who had started planning for retirement by investing in financial products, 47 percent said financial independence was the key reason why they started the process. Another 38 percent cited the need for maintaining their lifestyles during their post-retirement life and an equal number (38 percent) circled taking care of medical expenses as the driving factor. Close to 35 percent of the respondents had not invested in any financial product to save for retirement. Amongst the rest, 40 percent had chosen life insurance, followed by recurring deposits and fixed deposits (27 percent), mutual funds (12 percent real estate (11 percent) and physical gold (10 percent).
Majority of Indians want to live with children after retirement
India’s traditional, joint family system might be undergoing a change, but a vast majority of those polled said they will be staying with their children post retirement. While 50 percent were certain that they would, 32 percent said they might stay with their children. Only two percent had plans of staying separately.
Source for all images: Max Life Insurance
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