Retirement planning: Many young professionals of India want them not to wait for retirement till the age of 60. According to a new report by Grant Thornton Bharat, about 43% of the age of 25 years or less want them to retire at the age of 45 to 55 years. But the problem is that their savings and investment habits are not according to this dream at all.
Dream big, but less savings
Most of the people involved in this survey admitted that they are saving only 1% to 15% of their salary for retirement. That is, there is a thinking of retiring quickly, but the money that should be prepared for it is not there. This report makes this clearly clear.
Pension is needed ₹ 1 lakh, not trusting
More than half of the people involved in the survey are expecting a pension of more than ₹ 1 lakh every month after retirement. But only 11% of them are confident that their investment will be able to give so much money. Only 3.65% of the people were overwhelmed that their pension products would be able to meet retirement requirements.
At the same time, 42% of people are not confident at all that their pension plan will work in future or will be able to fulfill their needs.
Still trust in old plans
It was also revealed in this survey that most people are still dependent on government schemes like EPF (Provident Fund), Gratuity and NPS. The entire retirement planning of 83% of the people rests on these schemes.
Nowadays many private companies also provide pension schemes, which give sure money every month after retirement. Such as Annuity Plans. However, 76% of people have not yet invested them.
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There is also a huge shortage of information
The most important thing, people who want to retire quickly, there is also a lack of financial information within them. More than 50% of the people involved in the survey have no information about Atal Pension Yojana. At the same time, only 17% of the people believe that they understand the calculation of their pension well.
What is necessary to do?
The report said that people need to explain properly about financial planning and retirement schemes. Also, such schemes should be brought which give firm and regular money after retirement. Also, people also need to increase their financial understanding, so that they can take decisions related to investment better.
How to plan to retire early?
- The sooner you start savings and investment, the more benefit the compounding will benefit. Start in SIP, mutual funds or NPS.
- Put at least 20% of the salary in retirement funds every month. Instead of saving after spending, spend after saving.
- Provident funds (PF) and gratuity are necessary, but this is not enough. See also options like private annuity plans, stocks and real estate.
- Think how much money will be needed after retirement. Accordingly, plan annual targets and returns.
- Make an investment portfolio by meeting a professional financial advisor and keep reviewing it from time to time.
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