Most Indians have a positive view of life after retirement, a recent study by ICICI Prudential Life Insurance has revealed.
The study “Is India prepared for retirement?” conducted in association with Quantum Consumer Solutions found that most Indians consider retirement as “a pause and not a stop”.
The survey covered over 1,100 individuals to understand their attitudes toward retirement, money, and annuity plans and provides deep insights from diverse perspectives, including government employees, private sector employees, business people, self-employed, and retirees across the age bracket of 45 to 75 years from cities with a population of more than 2 million.
The findings show that retirement is viewed positively “as a time full of possibilities”. Many individuals view it as a phase of “maintenance, upgradation, and growth”.
For example, 83 per cent of respondents consider continuing with the current lifestyle into their retirement as their topmost priority.
The study further showed that over three-fifths of the respondents’ goals were to enjoy life, stay connected with friends, travel abroad, be financially secure, and have peace of mind.
Though the retirement phase evokes positive emotions among respondents, the study said, they are also cognisant of the need to factor in inflation and rising medical expenses while planning for their life’s new chapter, which, some felt, could impact their living standard.
In addition, over two-thirds of those surveyed mentioned that they worry about inflation impacting their retirement savings and, consequently, their lifestyle.
Other Findings Of the Study
Similarly, 67 per cent of the respondents highlighted the need to have adequate retirement corpus to take care of medical expenses if stuck with a terminal illness during their retirement.
The survey reveals that currently, 11 per cent of total income is channeled towards retirement-specific savings, and average respondents consider Rs 65.4 lakh an ideal corpus for retirement.
Individuals recognise the importance of guaranteed return products, such as annuity plans, designed for retirement and regular life-long income for themselves and their spouses.
The survey also revealed a high interest in investing in annuity plans, accounting for 65 per cent of respondents who have not invested in annuity plans yet.
The study also reveals that some individuals are already well prepared to lead a financially independent retired life. They start investing for retirement even before they turn 40 and put aside an average of 17 per cent of their income towards retirement. They invest mainly in National Pension System (NPS) and retirement/annuity plans, besides fixed deposits.
Commenting on the findings, Manish Dubey, chief marketing officer of ICICI Prudential Life Insurance, in a press release on Wednesday, said, “India’s retirement population is growing rapidly and is projected to show a 41 per cent increase by 2031. With increasing life expectancy, a large segment of people will be looking for solutions to plan for a longer retirement.”
He added, “More individuals are now viewing retirement as an opportunity to explore their interests, follow their passions, and spend time with family and friends. Retirement planning is a long-term process; hence, individuals should start saving towards this goal as early as possible.”