AI-generated image for representational purpose

New Delhi: About 70 per cent of urban Indians would like to retire before the traditional retirement age of 58-60 if their financial needs are fully taken care of, a report said on Wednesday.Half of those aspiring for early retirement want to achieve Financial Independence and Retire Early (FIRE) before the age of 50, India Retirement Index Study (IRIS 6.0) released by Axis Max Life Insurance said.

The study sample includes 4,134 households across metro, Tier I, and Tier II cities. The survey findings highlighted a gap between retirement aspirations and financial preparedness.
While 61 per cent of urban Indians said they know the corpus they would require to sustain their current lifestyle during retirement, only 11 per cent believe their corpus will last their lifetime. As many as 39 per cent believe their retirement corpus would not last even five years, it said.

Among respondents with annual household income above Rs 15 lakh, only 51% believe Rs 1 crore or less is sufficient. Among metro residents, the figure stands at 63%, compared with 73% in Tier I cities and 77% in Tier II cities, the report cited.

This variation is important because the retirement corpus required by an individual will depend on factors such as current lifestyle, expected expenses, retirement age, inflation, healthcare costs and how long the corpus needs to support them.

The survey also found that one in two urban Indians believes retirement planning should begin with the first paycheque, while the average age at which respondents think they should start planning for retirement is 31 years.

Among Gen Z respondents, the perceived ideal age to start retirement savings is lower at 29 years, compared with 31 years for Millennials and 34 years for Gen X+, it said.
Younger Indians are also beginning to invest for retirement relatively early, with 62 per cent of Gen Z respondents saying they have already started investing for retirement, compared with 70 per cent of Millennials and 75 per cent of Gen X+.
"Retirement remains a financial challenge for many Indians," Axis Max Life Insurance MD & CEO Sumit Madan said.
The finding that 82 per cent of Gen X+ respondents expect to continue working for a steady income highlights that retirement is increasingly being viewed as financial freedom and the ability to choose whether to work, rather than simply reaching a particular age, he said.
Health has also emerged as an important component of retirement preparedness, according to the survey. About 75 per cent of respondents expect to remain healthy and fit during retirement, while 52 per cent said they have purchased health insurance, it said. 
Tags: