Indian lack awareness about retirement planning
Bangalore, Jun 17: Highlighting the huge need for retirement planning in the country, ICICI Prudential Executive Director N S Kannan today said that there was lack of awareness among citizens on planning life after retirement.
Providing insight onplanning for the pensioned years at the ''Forever Young forum'' of CNBC TV18 here, he said with the cost of living continuously rising people were not well prepared for a planned retirement, ''There is a myth in the minds of Indians that market linked instruments are unsafe for investments for retirement planning.'' The reality was that fixed income instruments were also disadvantageous as they were not being able to beat inflation as interest rates had come down from 14 per cent in 1985 to 6.5 per cent currently.
Advocating four simple steps for planning retirement, Mr Kannan said it would be wise to start investing early, have a defined goal, choose the right asset allocation and right tool for accumulation.
Short-term investments were a more popular mode of investment amongst Indians as compared to long-term investments. Consequently a majority of the population ignore retirement planning, concentrating solely on marriage, home, family and children's education.
Statistically, only 11 per cent of the working population in India had any form of social security for old age. With people living longer, retirement was becoming more expensive.
The 'Forever Young Forum' is a series of introspective, on-ground events that seek to educate investors around the country about the A-Z of retirement planning, according to a spokesperson for CNBC TV18.