When it comes to retirement, most Indians prefer to rely on time-tested sources of income in post-retirement life. Also, maintaining one’s lifestyle post-retirement is the topmost priority of individuals, according to a recent study.
The study of over 1100 individuals by ICICI Prudential Life found that maintaining the current lifestyle was the top retirement goal of 83% of respondents. This was followed by travel to spiritual places (78%), property purchase (76%), new business (72%) and donation to a charity (70%).
Nearly 54% of the 1100 respondents said that they feared their investments may not sustain beyond a certain point after retirement while 66% of them felt that it will be difficult for them to maintain the standard of living post-retirement due to inflation.
Also Read: How much money is ‘ideal’ for retiring with the same lifestyle? Survey finds
The study further found that most Indians are geared towards investment options offering assured returns such as Public Provident Fund (PPF), National Pension System (NPS) and annuity plans that give regular income after retirement.
Some of the top concerns of the respondents were:
- Not having enough money for retirement
- Not knowing the right way to invest/grow money
- Making hasty and uninformed decisions by reacting to market trends
However, many Indians are now seeking advice from experts apart from doing their own research to have holistic investment planning for retirement goals.
5 most popular retirement income sources
According to the study, the following investments options were most preferred by the respondents for retirement:
- Annuity/retirement plans
- National Pension Scheme
- Public Provident Fund
- Fixed Deposit
- Post Office Savings Scheme
“Indians prefer to rely on time-tested sources for receiving income post-retirement. Those who are not relying on retirement income plans rely on sources such as interest on FD, monthly pension, income from businesses and more,” the report said.
The study also found that people, who feel prepared, generally start investing for retirement when are nearing the age of 40 years. They put aside an average of 17% of their income for retirement. Those who are not prepared set aside 11% of their income for retirement.
Also Read: How many crores can buy you happiness?
Among those preparing for retirement, NPS was favoured by 55% of respondents, followed by Fixed Deposit (49%), Annuity/Retirement Plan (32%), PPF (26%), Post Office Savings Schemes (26%), National Savings Certificate (24%), and Gold (23). ULIP, Mutual Funds and Stock Market were considered by only 9%, 8% and 3% of respondents only.