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- What is Retirement Planning? - Ultimate guide for retirement planning
- What is Retirement Planning?
- Why Plan for Retirement?
- Importance of Retirement Planning
- Retirement Planning Factors
- How Much Do You Need to Retire?
- Stages of Retirement Planning
- Retirement planning guide.
- Types of Retirement Plans
- Best Retirement Plan in India 2025
- Retirement Plan Eligibility
- How Retirement Planning Works?
- Retirement Planning Advantages
- Retirement Planning Tips
- Where to invest for retirement?
- Retirement Planning with Life Insurance
- How FIRE works?
- Retirement planning mistakes
- Aspects of Retirement Planning
- Retirement Plans by HDFC Life
- HDFC Life Pension Plans
- FAQs Retirement Planning
- Heres all you should know about Retirement Plans.
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RETIREMENT PLANS BUYING GUIDE
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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.
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What is Retirement Planning?
Retirement planning is the process of preparing your finances today in order to ensure a secure and comfortable life after you stop working. It involves estimating your future expenditures, considering the impact of inflation and building a mix of savings and investments that will generate a steady income in the course of your retirement years.
Key factors to consider include your lifestyle goals, medical needs, inflation and reliable income sources such as pension schemes or retirement funds.
For instance@, if you anticipate your month-on-month expenditures to be ₹50,000 today, you will need to plan for a higher amount. Say ₹80,000 or more, 20 years later, due to inflation.
@ - NOTE - The values shown are for illustrative purpose only.
Retirement planning in India assists you in creating a retirement corpus that ensures financial independence, meeting post-retirement goals and protecting you from financial worries in old age.
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Why Plan for Retirement?
Retirement planning is not just associated with saving money; it is even about preparing for the future where your salary stops, but your expenditures continue. Beginning the retirement planning process early assists you in building a strong retirement corpus and gives you the freedom to enjoy life without any financial stress.
The earlier you begin, the more you benefit from the power of compounding, which grows your wealth steadily over time. Let’s look at the key reasons why you should plan for retirement in India.
Protect Yourself from Rising Inflation
Inflation is when the cost of goods and services keeps increasing every year. In India, the average inflation rate is nearly 4–7%^. For instance, groceries equalling ₹2,000 today might cost more than ₹7,000 in 20 years.
If you just keep money in a bank account, inflation will lower its value. That is why retirement planning must be considered. It allows you to concentrate on long-term investments such as mutual funds, pension schemes and ULIPs, which assist your savings to grow faster as compared to inflation.
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Cover Healthcare Costs in Old Age
Healthcare expenses usually rise faster than general inflation. A surgery that costs ₹2 lakh today may cost over ₹6–7 lakh in two decades.
In fact, healthcare costs in India are projected to rise at 13% in 2025, higher than the global average of 10% and last year’s 12%, according to Aon’s Global Medical Trend Rates Report 2025^^. The report notes that this surge is driven by rising hospitalization rates and the growing use of advanced medical treatments.
As you grow older, medical requirements become more frequent and unanticipated illnesses or treatments can strain your finances. Here is why having health insurance is important. But equally critical is creating a separate medical emergency fund.
Thoughtful retirement planning permits you as well as your family to feel secure, knowing that healthcare costs will be managed without worry.
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Maintain Your Standard of Living
After retirement, your salary stops. But your lifestyle needs remain. Whether it's travelling, pursuing hobbies, or simply enjoying the same comfort you had before, retirement planning helps maintain your standard of living.
For example, one retiree who saved and invested early continues to travel every year, while another without a plan struggles to meet even basic expenses. The right planning ensures you don’t compromise on your goals.
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Stay Financially Independent
In India, family support is common, but true dignity comes from financial independence. Retirement planning gives you the freedom to make your own choices without depending on children or relatives.
It means you can live life on your own terms, whether that’s moving to a peaceful city, supporting a cause you care about, or enjoying quality time with your spouse without financial pressure.
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Make the Most of Compounding
Compounding means earning returns on both your investment and the returns already earned. The earlier you start, the bigger the benefit.
For example**, if you invest ₹5,000 per month:
Age You Start |
Corpus at 60 (Assuming 10% returns) |
25 years |
₹1.9 crore |
40 years |
₹50 lakh |
** NOTE - The values shown are for illustrative purpose only.
This clearly shows how to plan for retirement early. The sooner you start, the more time your money gets to compound. A small month-on-month investment done in your 20s can permit you to grow the investments into crores.
However, the same effort done in your 40s may yield only a fraction. Starting your retirement savings early is a key to reaching your goals with less effort.
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Be Prepared for Longer Life Expectancy
Life expectancy in India was 72 years in 2023^# and is still rising. This means your retirement funds must last for 20–25 years or more after you stop working. With zero proper planning, there is a risk of outliving your savings.
By building a robust and prudent retirement plan, you ensure financial security across your lifetime even as you live longer than previous generations.
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Importance of Retirement Planning
Plan for Uncertain Economic Conditions
Lower Dependence on Social Security or Government Schemes
Enable Wealth Transfer and Legacy Planning
Take Advantage of Retirement-Specific Tax Benefits
Achieve Peace of Mind and Financial Confidence
Retirement planning is not just about saving funds; it is, in fact, associated with building financial security, stability and mental peace for your future. Here are the reasons why it matters.
The economy might change in ways that are not expected. Recessions, inflation or instability in the job market can impact your savings as well as investments. For instance, in the course of COVID-19, many witnessed income disruptions while their expenses continued.
A prudent retirement plan comes across as a safety net. This makes sure that even if the economy shifts, your future lifestyle remains secure.
While schemes such as EPF, pensions or other government allowances endow great support, they might not be adequate to cover all post-retirement expenditures. For example, the month-on-month pension from EPF might fall short of mitigating rising healthcare or lifestyle costs.
By building your own retirement corpus, you gain more control, flexibility and great confidence that your needs will be met.
Retirement planning is not just about mitigating your needs; it is even about securing the future of your family. Through estate planning tools such as wills, trusts and beneficiary designations, you can ensure your wealth is passed on in a smooth manner to your chosen heirs.
Early planning prevents disputes, safeguards your assets and permits you to decide how and when your wealth must be transferred.
Investing in retirement plans also brings tax benefits. Contributions as per Section 80C# , Section 80CCC and Section 80CCD(1) (of up to ₹1.5 lakh). In addition, Section 80CCD(1B) (an additional ₹50,000 for NPS) can lower your taxable income^^.
Using such benefits early not just lowers your tax liability but also assists your corpus in growing faster through the long-term compounding effect.
Perhaps the greatest importance of retirement planning lies in the emotional security it provides. Knowing that your future is funded reduces stress and allows you to make better life decisions.
For example, a couple who began planning in their 30s can now travel, pursue hobbies, and support their children without financial worry, proving that peace of mind is the real return on investment.
Factors to Consider While Planning for Retirement
A successful retirement plan should be tailored to your age, lifestyle, financial situation, and long-term goals. By considering the following factors, you can create a retirement plan that is realistic, personalized, and built to last.
Age and Time Left Until Retirement
The number of years left before retirement plays a big role in your investment choices. Younger individuals can afford to take up higher risks with equity investments for greater returns. Those closer to retirement years must focus on safer and fixed-income options that safeguard capital as well as provide great stability.
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Current Savings and Investments
Begin by assessing your prevailing savings, such as EPF, PPF, NPS, mutual funds, and fixed deposits. Being aware of the current size of your retirement corpus assists you in computing the shortfall and determining how much more you require to invest to meet your goals.
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Expected Retirement Lifestyle
Think about the kind of lifestyle you want after retirement. A modest lifestyle requires a smaller corpus. However, frequent travel or luxury living will require significantly more. Your lifestyle goals directly shape your financial targets.
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Inflation and Cost of Living
Inflation lowers the buying power of your money over a long time. For example, ₹50,000 today might not be sufficient 20 years from now. Also, living in a metro city will cost more than retiring in a smaller town. Accounting for inflation as well as location ensures your plan remains realistic.
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Health and Medical Requirements
Healthcare needs typically rise with age. Make sure to consider insurance premiums, medical check-ups and possible emergencies. Examining your family’s medical records can assist in estimating future costs more accurately. Building a separate health fund ensures you won’t dip into your retirement corpus for meeting medical bills.
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Sources of Retirement Income
List all potential income sources after retirement (pensions, rental income, business earnings, or part-time work). A diversified income strategy reduces dependency on a single stream and makes your retirement financially more secure.
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How Much Do You Need to Retire?
The amount you would need for retirement is very personal depending on your financial needs and wants post retirement. Ideally, you should start investing in a retirement plan as early as possible. This will give you enough time to create a retirement corpus for a financially secure future in the long run. Once accumulation is done, the corpus can be used to purchase annuities for monthly income post-retirement. Furthermore, even after being converted to annuities, the retirement corpus can continue to grow. The annuity payouts can either be lifelong or for a certain period of time post-retirement.
Take the following things into consideration while calculating your retirement corpus –
Monthly expenses
Existing savings
Systematic investments
Inflation rate
With the above values you can use the retirement calculator to calculate your retirement corpus.
Stages of Retirement Planning
Retirement planning in India is a crucial aspect of financial security. It involves saving and investing for a comfortable post-retirement life. The journey can be divided into three primary stages as discussed below:
Young Adult (Ages 21–35)
This is the perfect time to begin saving for retirement. Make an in-depth budget first. This will allow you to comprehend your income and spending. Set aside some, even if it is a small percentage of your income, for retirement savings. Think about making long-term investments in equities, mutual funds or employer-sponsored retirement plans.
Examine retirement plans supported by the government, such as the NPS. Moreover, it is important to understand that compounding gives your investments more time to grow if you start them early.
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Early Midlife (Ages 36–50)
Your career should be well-established by this point, and your salary could have gone up. Analyse your retirement plan and make any required modifications. Boost the amount you contribute to your retirement funds. Start making contributions to the NPS if you have not already.
Understand that re-evaluating your investing plan as well as risk tolerance level is also a prudent idea at this point. To safeguard your funds as you get closer to retirement, you might wish to switch your investments to more conservative ones.
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Later Midlife (Ages 50–65)
Make sure to maintain and increase your retirement funds as you get closer to retirement. Regularly review your portfolio and make the necessary modifications to keep it in line with your time horizon and risk tolerance. To reduce risk, think about diversifying your investments. Look at possibilities to augment your retirement income, such as reverse mortgages or annuities..
It is crucial to budget for anticipated medical costs at this point. Take into account acquiring sufficient coverage for your health insurance. Examine long-term care choices as well to handle any future needs.
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A Step-by-Step Guide to Retirement Planning Process
Retirement planning becomes easier when you follow a properly structured approach. Go through the 10-step retirement planning process that you must consider using:
Decide Your Target Retirement Age
Choose when you want to retire, whether that’s 55, 60, or later. The earlier you retire, the more years your savings and investments must support you.
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Define Your Retirement Lifestyle & Goals
Think about how you want to live after retirement, whether it’s living comfortably at home, travelling often or spending time on hobbies. This will assist you in figuring out how much money you will require.
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Estimate Monthly Expenses in Today’s Terms
Compute your present month-on-month spending, including household bills, healthcare, and leisure. For instance, if you spend ₹50,000 per month today, then note this figure.
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Adjust for Inflation
Make sure to factor in rising costs. With India’s inflation averaging 6–7%, your ₹50,000 today may equal ₹1 lakh in the upcoming 20 years.
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Calculate the Retirement Corpus You Need
Multiply your future monthly expenses by the number of years you expect to live after retirement. For instance, ₹1 lakh x 20 years = ₹2.4 crore. Make use of a retirement calculator to refine this figure.
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Assess Your Current Savings and Investments
Make sure to take a thorough stock of your existing savings, Employee Provident Fund (EPF), Public Provident Fund (PPF), mutual funds or pension plans.
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Identify the Gap Between Corpus Needed and Current Savings
Deduct your current assets from the required corpus. This shows the shortfall you must bridge.
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Decide Your Monthly Contribution and Asset Allocation
Set up a realistic investment amount every month and split it across equity, debt or hybrid instruments, based on your risk tolerance level.
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Select the Right Retirement Plans & Investment Vehicles
Select from options like National Pension Scheme (NPS), Unit-Linked Insurance Plans (ULIPs), pension schemes or mutual funds to build long-term wealth and generate retirement income.
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Review and Rebalance Annually
Keep a thorough track of your progress. Adjust your contributions year-on-year to remain on course. You can even consult a financial advisor for expert guidance.
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Types of Retirement Plans
Retirement planning in India can be done by investing in a range of retirement plans that can help ensure a steady stream of income to maintain a certain lifestyle post-retirement. Currently, the retirement plans in India include annuity plans, retirement funds, Unit-Linked Investment Plans and the National Pension System.
Immediate annuity plans
Annuity plans help a retired individual with regular monthly payments. How does this retirement plan work? After one has made a single lump sum investment, the annuity payout begins within a year. This option is particularly helpful for those who are nearing their retirement and require a feasible option.
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Deferred annuity plans
As the name suggests, this kind of annuity plan works differently than the one mentioned above. Here, the investor decides the time period over which they want to receive the annuity payouts. In this case, an individual makes small payments over a period of time to create a large corpus for retirement.
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Senior citizen savings scheme
This government-backed scheme offers regular income to individuals post-retirement. This type of plan can be availed by retired persons who are over 60 years or above, or even by those who fall between the range of 55 and 60 years.
The investment can be as low as Rs 1,000 in a year while the maximum investment goes up to Rs 15 lakh. The initial time period for investment is five years that can go up to an additional three years after maturity. The current interest rate for such plans is 8.2% per annum for 2023-24.
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National Pension System
NPS can be extended to individuals who fall between the range of 18 and 70 years. The tax benefits under this plan can go up to Rs 2 lakhs in a financial year and works best for those who have a moderate to high risk appetite. This is because investments are largely in market-linked instruments including equities and debt funds. Investors can also opt for corporate, government bonds and alternative investment funds. The National Pension Scheme account matures after the investor turns 60 years old.
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Best Retirement Plan in India 2025
Plan Name |
Category |
Interest/Return |
Tax Benefits# |
Eligibility |
Senior Citizen Savings Scheme |
Government-backed |
7.4% |
Deposit amount eligible for deduction under Section 80C#, interest is taxable. |
Age 60 plus (55-60 with retirement benefits) |
Public Provident Fund (PPF) |
Government-backed |
7.1% |
Contributions, the interest earned, and the maturity amount are tax free (EEE) |
Indian resident, Age 18+ |
Atal Pension Yojana (APY) |
Government-backed |
Market-linked to contributions |
Contribution amount eligible for deduction under Section 80CCD (1) |
Age 18-40 |
National Pension Scheme (NPS) |
Market-associated plan |
Market-linked (10-12% average, equity returns) |
Section 80C# + Section 80CCC + Section 80CCD(1) + Section 80CCD (1B) ₹50 lakh extra |
Age 18-70 |
Unit-Linked Insurance Plans (ULIPs) |
Market-associated plan |
Market-linked (varies by fund) |
Section 80C; Maturity tax-free subject to conditions prescribed |
As per insurer terms |
Retirement Mutual Funds |
Market-associated plan |
Market-linked (varies by fund) |
Long Term Capital Gains (LTCG)/Short Term Capital Gains (STCG) tax based on holding |
Age 18+ |
Immediate Annuity Plans |
Guaranteed pension |
5-7% typically |
Pension taxable as per the income slab rate |
As per the insurer’s terms and conditions |
Deferred Annuity Plans |
Assured pension |
Based on the annuity rate at the time of purchase |
Pension taxable as per the income slab rate |
As per the insurer’s terms and conditions |
Eligibility Criteria for Retirement Plans in India
The eligibility criteria for retirement plans in India are discussed below:
- Entry Age: The minimum enrolment age for most retirement plans is 18 years. This permits individuals to take charge of their financial future early and benefit from the compounding effect. There might be variations based on specific plans, with some having a higher entry age limit. Make sure to check out the eligibility details of the plan you are considering.
- Premiums: The amount you contribute on a regular basis towards a retirement plan is called a premium. Such contributions can be chosen based on your affordability and desired retirement income. Some plans endow flexible premium options, permitting you to adjust your contributions as your financial scenarios evolve.
- Vesting Age: Vesting age is the age at which you can start receiving the retirement benefits accumulated in your plan. This age can differ based on the specific plan you zero in on. But it usually falls between 40 and 80 years.
Some plans offer immediate annuities, where payouts commence as soon as you purchase the plan. Understanding the correct time to begin receiving annuity is very important for the retirement planning process, as it dictates when you will have access to your retirement savings.
How Retirement Planning Works?
The objective of retirement planning is to prepare you and your loved ones for a stress-free retired life. Robust retirement planning will ensure that you are able to generate a steady flow of income to meet your regular expenses and fulfill your financial goals post retirement. Ideally retirement planning is a continuous process which evolves over time:
Early years
When you are young and starting out, your contributions towards your savings for your retirement may be limited but to reap the benefits of retirement plan you should start early.
Middle years
When you have established a sizeable source of income you are recommended to increase your contributions to your retirement plan. This approach will help you boost your savings.
Later years
Close to your retirement you set yourself to reap the benefits of savings for decades. This is the time when your start receiving the rewards to live a stress-free retirement.
Advantages of Retirement Planning
There are several advantages or benefits of retirement planning –
Life expectancy
The average life expectancy today is 70-75 years, so if you retire at 60 years, you will still have many years of retirement where you need a regular income. That’s where a comprehensive retirement plan helps.
You can start your retirement planning as early as 20 years, 30 years, or 40 years of age.
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Medical costs
As the costs of medical treatments rise, it is important to have a corpus for emergencies. While a sound health insurance plan can help you tide over such emergencies during your work life, it’s better to factor in medical expenses that arise in old age as well.Premium paid on health insurance for self and family are also eligible for deduction under Section 80D of Income Tax Act, 1961 The maximum deduction available for the family shall be ₹25,000. In case the insurance premium paid on the health of a senior citizen in the family then an additional deduction of ₹25,000 shall be available.
That’s because spending from your own pocket is not practical, particularly during old age, when an individual is more susceptible to illnesses.
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Tax benefits
Investing in a retirement plan can help reduce tax liability and maximize savings. You can claim a deduction of up to Rs 1.5 lakh for the premiums paid towards the plan under Section 80C of the Income Tax Act, 1961#.
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Peace of mind
It may sometimes be very challenging to manage money, both for short-term and long-term needs. Sometimes, health issues may crop up without notice, and it’s bound to hurt your pocket, especially if you are old and do not have a regular income.
With retirement planning, you can stay happy and healthy without being stressed.
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Tips for Retirement Planning
Start Saving Now
When it comes to planning for retirement, the earlier you start, the better. Starting early gives you more time to save a corpus that will grow steadily each year.
The power of compounding works better the longer you stay invested, so purchasing one of the various types of pension plans in your 20s and 30s will help you enjoy a financially secure retirement.
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Prepare for Future Financial Emergencies
While planning for your retirement days, you must factor in future financial contingencies. For instance, buying a health insurance plan and setting up a contingency fund to help with medical costs or other emergencies helps you maintain your financial independence once you retire.
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Explore Life Insurance Options
Every good financial plan includes a life insurance policy. You can consider availing a term plan to secure your family's financial future and assist your spouse in preparing for retirement. Make sure you examine your options and figure out a policy that provides adequate support for your loved ones.
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Diversify Your Investments
When it comes to planning your finances for the future, never ever put all your eggs in one basket. You should find ways to diversify your investments to ensure good returns over the years. Ideally, look for investment options that allow you to lower your risk by investing in different types of funds.
Evaluate the various investment and retirement plans available and pick one that suits your financial goals and risk appetite.
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Think About Your Retirement Goals
Finally, before you purchase any retirement plan, understand how much you would require to attain your post-retirement goals. Consider the cost of travelling in the future, or the cost of learning how to play an instrument or setting up a consultancy.
List your goals and carefully consider how much they would cost. Once you understand how much you need, you can work on a plan to help you achieve your target.
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Where should you invest for retirement?
There are many types of investments you can consider for retirement. While some options offer regular income with low risks, others take higher risks but offer higher potential income. You should pick an option based on your risk appetite, investment objectives, and the number of years left till your retirement.
Here are some of the best choices for different retirement objectives:
- For Regular Income after Retirement
Retirement annuity plans provide you with regular and assured returns for a certain number of years as per the stipulated terms. You can also invest in a government scheme like NPS (National Pension Scheme) to get a fixed annuity after retirement.
- Safe and Secure Investment without Market Volatility
Fixed deposits offered by banks and post offices offer fixed returns, which are not affected by changes in the market.
- Guaranteed Lifelong Income
Certain annuity plans provide an assured sum as a pension for a specific number of years as you choose. Senior Citizen Savings Schemes also provide assured income at fixed interest rates.
- Tax Benefits on Investments
Many investment options, such as PPF (Public Provident Fund), ULIP (United Linked Insurance Plan), ELSS (Equity Linked Savings Scheme), NPS, etc., offer tax savings under Section 80C of the Income Tax Act.
- Customisable As Per Your Needs
Customisable As Per Your Needs - Stocks, mutual funds, and ULIP plans come with market risks but offer greater incomes than traditional pension plans. For example, HDFC Life Sampoorn Nivesh Plus offers customizable investment options through equity, debt, and balanced funds, making it suitable for various retirement planning strategies based on your age and risk appetite. If you have a long time till retirement, you can use these options to grow a substantial retirement corpus.
Retirement Planning with Life Insurance
A retirement or pension plan with life cover provides you with peace of mind as it ensures the financial safety of your loved ones in your absence. The insurance gives a large payout to your dependents in the event of your unfortunate demise, allowing them to live their lives and pursue goals like higher education and marriage. Moreover, if you have outstanding obligations like a home loan, it enables them to retain ownership of your home.
Financial Independence, Retire Early (FIRE) – How does it work?
In recent years, we have observed an increasing urge to retire early. Financial Independence, Retire Early (FIRE) is a school of thought that encourages individuals to save and invest a major portion of their earnings with the objective of attaining financial independence.
Using FIRE as a means to achieve financial independence requires you to be frugal with your expenses and be very diligent with your investment allocation. Here are some ways by which you can plan for your FIRE:
Build An Emergency Fund
Before getting on with your journey of growing your wealth, you should keep at least 3-6 months of your monthly expenses aside as your emergency fund for the rainy day.
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Financial Protection
Before identifying suitable investment opportunities, you should get health insurance to curb the financial impact of a medical emergency, and you should also get term life insurance to protect the financial future of your loved ones in case of your death.
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Invest Wisely
It is imperative to have a very stringent investment approach and be disciplined towards the approach. The investment options you select should meet your financial goals.
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Reconsider Your FIRE Number
The basic approach to reaching your FIRE number is 25 times your annual expenses and then withdrawing 3-4% of your portfolio to manage your expenses post-retirement.
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Retirement Planning Mistakes to Avoid
When making a retirement plan, make sure to avoid the common mistakes listed below:
- Not Preparing for Emergencies: Your retirement savings must account for unforeseen emergencies such as medical treatments, accidents, etc. Most experts recommend keeping at least 6 months’ worth of income aside for the purpose of meeting emergencies.
- Not Planning Ahead: Your retirement plan must cover everything from budgeting and expense planning to investments and tax savings. Having a comprehensive plan helps you achieve your retirement goals.
- Carrying Debt into Your Retirement: You should avoid having any debt when you no longer have a source of income. Before you retire, make sure to pay off all your existing debts and rely on your savings and investments later on.
- Underestimating Required Savings: Many people tend to only account for their current expenses and necessities when calculating their savings requirements. However, factors such as inflation, taxes, out-of-pocket medical costs, and emergencies can substantially increase your needs.
- Not Starting Early Enough: Many tend to just account for their current expenditure and necessities when computing their savings requirements. However, factors such as inflation, taxes, out-of-pocket medical expenditures and emergencies can substantially increase your needs.
Note:
Investments qualify for tax deduction under Section 80C, 80CCC and Section 80CCD(1) of the Income Tax Act, subject to the overall limit under Section 80CCE of ₹1.5 lakhs.
If assessee has opted for Old tax regime, assessee shall be eligible to claim deduction under chapter VI-A (like Section 80C, 80D, 80CCC, etc). If assessee opted for New tax regime only few deductions under Chapter VI-A such as 80JJAA, 80CCD(2), 80CCH(2) are available.
What are other aspects of retirement planning?
Along with the amount you save it’s also important to take the complete financial scenario into consideration:
Medical insurance
Health insurance needs increases with your age. It is recommended that you get adequate medical insurance coverage well before your retire as premiums are higher at an older age.
Home
While getting a home we often end up taking high amount of liability in order to secure our home. It is recommended that you completely pay off your home loan amount before your retirement so that you don’t have to bear the burden of the liability.
Estate planning
We should plan the distribution of your wealth and assets in our absence well in advance to avoid any hassle during your retirement
Secure Your Retirement with Our Pension Plans
FAQ's about Retirement Planning
What is the 4% rule in retirement planning?
The 4% rule in retirement planning helps you make your funds last for 30 years. The rule states that you should withdraw only 4% of your corpus in the first year, and for every subsequent year, raise the withdrawal amount enough to keep up with inflation.
Why do you need retirement planning?
Retirement planning ensures financial security in your golden years. It helps bridge the gap between your working income and retirement expenses, fostering peace of mind and the freedom to pursue your post-workday dreams.
What are the 3 R’s of retirement?
The 3 R’s of retirement are:
1. Retirement Planning – It involves setting aside a portion of your income through your working years so you have enough to support you once you retire.
2. Regular Income – Once you retire, you should have the means to get a regular stream of income. For example, purchasing a pension plan or annuity helps you enjoy a regular income to cover your daily expenses and maintain your standard of living.
3. Risk Management – Once you retire, you must manage and mitigate risks as far as possible. You can invest in low-risk investment instruments that provide steady returns to combat the impact of inflation on your savings.
What are basic retirement plans?
India offers two types of retirement plans, Pension Plans and Annuity Plans. The two often work together to secure your finances once you retire. You can purchase a pension plan in your 20s and 30s. The money you put into the plan gets invested on your behalf and builds up a corpus for your retirement. You can then use the corpus to purchase an annuity that provides regular payouts for the rest of your life.
What are some effective ways to plan for retirement and achieve financial goals?
Strategic retirement planning involves setting realistic goals, understanding your time horizon, and choosing suitable investment vehicles. Early and consistent savings, along with regular portfolio reviews, are crucial for building a secure financial future.
What is the retirement lifecycle?
The retirement lifecycle has three phases:
1. Pre-Retirement Stage – During this time, individuals are working and focusing on saving and investing for retirement.
2. Retirement Stage – Just after retirement, people in this stage rely on their investments to take care of their day-to-day expenses.
3. Post-Retirement Stage – At this stage, people may require additional support while dealing with age-related health concerns. Some individuals may require long-term care, which will only be possible through adequate financial planning in the pre-retirement stage.
What is the legal retirement age in India?
The legal retirement age in India varies across sectors. The private sector does not have any stipulated age limit. For Central Government employees, the retirement age is 60, while State Government employees have to retire at 58. For Defence personnel, the retirement age depends on their rank. Soldiers in the army likely retire between 35 to 37, while officer’s can retire at 58.
What is the ideal income I need in retirement?
The amount you need once you retire depends on your standard of living and expected expenses. For example, individuals who live on rent will likely require more than those who have their own homes and only have to worry about maintenance and taxes. You can use an online retirement planning calculator to better understand how much you would require.
When is the right time to start planning for retirement and how much do I need to save to prepare?
The ideal time to begin retirement planning depends on your circumstances, but starting early maximises the effect of compounding. Determining your savings target involves factors like desired lifestyle and retirement income sources. Financial advisors can create a personalised plan.
What is deferment?
Deferment refers to the strategy of delaying retirement and continuing to work beyond the traditional retirement age. The approach helps people boost their savings and delay the withdrawal of their retirement funds. It can also help people stay active and maintain their physical and mental well-being.
What is retirement planning?
Retirement planning is a process of setting aside assets for retirement, so that one can lead a comfortable life and be financially independent even after they stop earning regular income. In a nutshell, it is a savings programme that manages assets and risks post-retirement.
What are the steps in planning your retirement?
There are a few steps that you must keep in mind while planning your retirement. The first step is to define the financial goals and the amount that is required to meet those goals. Next, evaluate the retirement date to figure out the investment horizon. You can use a retirement planning calculator to understand how much is needed to grow your wealth before retirement. The last step is to purchase a retirement plan and pay regular premiums to create a large corpus for a financially secure future.
Here's all you should know about Retirement Plans.
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#Tax benefits & exemptions are subject to conditions of the Income Tax Act, 1961 and its provisions.
#Tax Laws are subject to change from time to time.
#Customer is requested to seek tax advice from his Chartered Accountant or personal tax advisor with respect to his personal tax liabilities under the Income-tax law.
1. Amount of guaranteed income will depend upon premiums paid subject to applicable terms and conditions.
2. As per Income Tax Act, 1961. Tax benefits are subject to changes in tax laws. Tax benefits & exemptions are subject to conditions of the Income Tax Act, 1961 and its provisions.Tax Laws are subject to change from time to time. Customer is requested to seek tax advice from his Chartered Accountant or personal tax advisor with respect to his personal tax liabilities under the Income-tax law.
3. Lock in – Applicable if Variant 2 - With Guaranteed Income variant is chosen.
4. Guaranteed Benefit is paid on survival during policy term provided all due premiums are paid during the premium payment term.
5. Allowed only after completion of 3 years from commencement of policy, upto 3 times during policy term, maximum upto 25% of the total premiums paid, subject to receipt of all due past premiums or if Waiver of Premium (WOP) benefit has been triggered
^ Source – https://www.macrotrends.net/global-metrics/countries/ind/india/inflation-rate-cpi
^^ https://npscra.nsdl.co.in/tax-benefits-under-nps.php/all-citizens-faq.php#:~:text=Any%20individual%20who%20is%20Subscriber,lac%20under%20Sec%2080%20CCE.&text=An%20additional%20deduction%20for%20investment,under%20subsection%2080CCD%20(1B).
^#https://datacommons.org/place/country/IND?utm_medium=explore&mprop=lifeExpectancy&popt=Person&hl=en
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