• Webpages
  • Documents
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment

For NRI Customers

(To Buy a Policy)

(If you're our existing customer)

For Online Policy Purchase

(New and Ongoing Applications)

Branch Locator

For Existing Customers

(Issued Policy)

Fund Performance Check

Planning for Financial Security – How Much Should I Save for Retirement?

How much to save for retirement?  Plan your finances
November 24, 2023


Retirement, a time when you can finally kick back and enjoy life without the daily grind of work, is a dream that most of us share. But to make that dream a reality, it’s crucial to save for retirement diligently and strategically. One of the most common questions people ask while planning for retirement is, “How much should I save for retirement?” Let’s try and answer the question for you.

The Retirement Savings Equation

Saving for retirement is not a one-size-fits-all endeavour. The amount you should save depends on your age, income, lifestyle expectations, and retirement goals. However, you can use the 15% rule as a general rule of thumb.

The 15% rule suggests you save at least 15% of your annual income for retirement. The amount includes contributions to retirement accounts like the National Pension System (NPS), private pension plans, or pension plans offered by your employer, such as the Employees’ Provident Fund (EPF). While this guideline is a helpful benchmark, it may not suit everyone.

Assessing Your Retirement Goals

You must evaluate and clarify your retirement goals to determine how much you need once you retire. Consider the following questions:

  • When do you plan to retire?

  • The age at which you retire significantly impacts how much you need to save. Early retirement generally requires more savings.

  • What kind of lifestyle do you want in retirement?

  • Do you envision a modest retirement or a more extravagant one? Your desired lifestyle will dictate your retirement expenses.

  • Do you plan to travel or have specific hobbies?

  • Special activities or hobbies in retirement can add to your expenses.

  • Will you have any outstanding debts in retirement?

  • You must think about whether you will have any outstanding loans. If yes, remember to account for the amount of debt in your retirement plan.

Consider the Impact of Inflation

Over time, the cost of living tends to rise due to inflation. So, the same amount of money will buy less in the future. You must factor in an inflation rate when calculating your retirement savings goal.

Crunching the Numbers

Once you understand your retirement goals clearly, you can crunch the numbers. Start by estimating your annual retirement expenses. It should include housing, healthcare, food, transportation, and any other costs specific to your retirement plans.

Next, consider your expected sources of retirement income, such as income from your pension, part-time work or other investments. Subtract your expected annual income from your estimated expenses to determine the annual income gap you need to cover through savings and investments.

The Role of Insurance in Retirement

Along with retirement planning, you must safeguard your family’s finances with insurance. Life insurance provides a financial safety net for your loved ones should anything happen to you. It can help cover various expenses, pay off remaining debts, if any, and empower your loved ones to maintain their standard of living.

The question of how much to save for retirement has no one-size-fits-all answer. It’s a personalised calculation based on your goals, financial situation, and expected retirement lifestyle.

Remember that saving for retirement is a long-term commitment. It requires discipline and regular assessments. By taking a proactive approach to retirement planning, you can build a secure financial future that allows you to enjoy your golden years without financial worries.

Related Articles: 

ARN - ED/09/23/4820

Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

LinkedIn profile

Author Profile Written By:
Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

LinkedIn profile

Reviewed By Reviewed By:
HDFC life
HDFC life


Reviewed by Life Insurance Experts


We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.

#This material has been prepared for information purposes only, should not be relied on for accounting advice. You are requested to seek advice from Chartered Accountant or personal advisor.