Most people in our country are not aware of retirement planning. Retirement planning is at the bottom of people’s priority, while the financial security of children and spouse and even fitness and lifestyle are at the top. This is revealed in the survey of the PGIM India Mutual Fund. The work of this survey was assigned to Nielsen. This survey was conducted to know the attitude of the people towards retirement.
Paying attention to not spending savings
The retirement survey of PGIM India Mutual Fund has revealed that the perception is now outdated that India is a country of savings. The increasing number of home loans, unsecured loans and credit cards suggest that Indians are now reducing savings and investment, and are now focusing more on current expenses rather than saving or planning for the future.
People spending 59% of income on current expenses
Today urban Indians are saving less and investing, they are spending around 59% of their income on current expenses. Given the low savings, there is growing concern among Indians about their future. 51% of the people surveyed did not make any financial plan for their retirement. 89% of Indians who have not prepared for retirement do not have any alternative means of income.
People do not know how much retirement fund should be
Only 1 out of every 5 Indians consider inflation while making retirement planning. 41% of the people surveyed said that in investing for retirement, they have insisted on life insurance, while 37% have preferred FDs. 48% of the participants had no idea what amount they would need for the post-retirement life. Of the 48% of those surveyed who did not know how much money they wanted, 69% did not make a retirement plan. In contrast, of the 52% who had awareness about the amount they would need for life after retirement, only 66% had retirement planning.
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The goal is to create a fund of 50 lakhs
On an average, urban Indians aim to create a fund of around Rs 50 lakh. The average annual income of the people in our survey was about Rs 5.72 lakh and the average age was 44 years. These participants believe that they will need a fund of about Rs 50 lakh for retirement i.e. around 8.8 times their current annual income.
The traditional model of permanent employment and retiring till the age of 60 is getting increasingly old. Now the emphasis is on fulfilling dreams and living a better life. People are planning for good results and unintended opportunities, not bad results. Or for known opportunities such as retirement.
The breakdown of joint families, the presence or absence of alternative sources of income, the possibility of becoming dependent on children in old age is playing an important role in people’s attitude towards retirement. Indians feel more secure financially and are still considered an important foundation for retirement.
Most Indians do not have a ‘retirement fund‘ – either because they have not yet retired planning Started, or they have so much fund or investment that they can use for retirement in the future, if no other very bad circumstances arise, the people of Tojin have planned to retire, 51% of them are people whose Have some alternative income.
Priority over priority is given to the income security of children and spouse and even fitness and lifestyle. Only 46% of private-sector employees believe that their employers have motivated them to plan for retirement. 65% Indians It is believed that if the employer advises on retirement planning, their loyalty to the institute will increase further.
Lack of awareness among people
This survey also shows that those who have done retirement planning also lack awareness about how the right financial planning should be done. Similarly, this survey reveals that Indian people seek better quality advice from their employers and financial advisors and they are looking for products that balance between their aspirations and financial stability.
Indians are worried about their future but not aware
Although retirement is not a priority, Indians are still more worried about their future and they are worried about their future expenses, health issues and lack of support from family. The study also shows that elements such as the breakdown of joint families, whether or not there are alternative sources of income, and the fear of relying on children in old age plays an important role in people’s attitude towards retirement.
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Survey done in 15 cities
In this survey conducted in 15 cities, some specific questions were emphasized, such as when do Indians plan to retire and what are the possible reasons for this? What financial instruments do they use? Does lack of awareness undermine retirement planning? Are Indians eager for more information on retirement planning? And how can employers play an important role in raising such awareness in them?
Our responsibility to prepare retirement fund
Ajit Menon, CEO of PGIM India Mutual Fund said, “In today’s world, if you cannot get a loan for just one financial goal, then it is retirement.” That is why it is the responsibility of all of us to be prepared for this in every way. Given the increasing number of senior citizens in the following years, we felt the need to study what the decision-making process is for retirement savings and how much awareness people have towards this financial goal?
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