An overwhelming number of Indians do not plan for their silver years and are in denial about retirement, says a new study.
According to the second edition of the ‘India Retirement Index Study’ (IRIS) – a self-administered digital study by Max Life Insurance in association with KANTAR which surveyed 3,220 respondents across 28 cities – Indians are financially, socially and emotionally ill-prepared for retirement.
The latest edition of the study said that India’s Retirement Index (on a scale 0 to 100) is at the same level (44) seen in the first edition last year. Most Indians’ dependence on family and children is major barriers to plan for retirement investment. The study reveals that only 1 in 3 Indians prioritise financial readiness for retirement. About 23 per cent Indians do not even know where to begin their retirement planning.
“You can’t see retirement (in India) as only a financial problem. There is also this aspect of most of our survey respondents (96 per cent) expressing desire to stay with their children in post retirement years while the actual trend is of increase in nuclear families. So this is going to be a social issue,” Prashant Tripathy, Managing Director and CEO,Max Life Insurance told businessline.
Ajit Menon, Chief Executive Officer, PGIM Mutual Fund, told businessline that it is necessary to have expert help in financial planning.
“At a personal level, I have followed my own advice to others by appointing a trusted financial adviser for the family’s financial goals. Money decisions are deeply emotional and an unbiased and trusted expert guiding you is the best way to keep your personal biases and financial habits in check,” Menon said.
According to Srinath Sridharan, an independent markets commentator, retirement and death are words that traditionally are touchy topics that people don’t want to confront.
“But I plan to invest across product categories which are suitable for my financial risk parameters, age and retirement goals. I assume that over the next 30 years, we might have a low interest rate regime, with service inflation increasing and healthcare costs increasing,” he said.