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According to PGIM India MF’s Retirement Readiness Survey 2023, an increasing number of Indians believe they are prepared for their retirement. The figure has seen a rise from 49% in 2020 to 67% in 2023.
In the press release, Ajit Menon, CEO, PGIM India MF, said, “We saw a visible attitudinal and a behavioural shift overall, where the pandemic seems to have impacted certain significant aspects. The emphasis on ‘self-Identity’, ‘Self-Care” & ‘Self-Worth’ have emerged as more important than ever alongside fulfilling roles and responsibilities towards one’s family.”
Dr. Sagneet Kaur, SVP, Behavior Finance & Consumer Insights, PGIM India MF, said, “Overall, the rise of retirement planning among Indians is a positive trend that will gain momentum if we truly understand and build products to nudge investors overcome their behavioural biases while investing for long term, as biases can tempt even the most discerning investor to abandon their well-established long-term strategies for the pull of immediate gratification driven by short-term emotions and desires.”
Other key findings from the retirement survey-
- Indians are allocating 59% of their money to household expenses and 18% to pay off their loans
- 5% of the individual’s income is allocated towards skill development or education loans
- 48% respondents reported that pandemic has made people more financially conscious, planned and disciplined
- With lower income group, there’s a higher focus on generating more returns and becoming financially secure. For higher income groups, other facets like reaching a higher position in the current workplace and developing a passive income source take precedence
- Post pandemic, ‘Inflation’ and ‘Economic Slowdown’ are on the top list of worries related to managing finances post-retirement
- From 10% in 2020 to 23% in 2023, the preference towards mutual funds shows more traction over direct equity/shares and exchange traded funds (ETFs)
- With changing lifestyle and macro-economic conditions, Indians think they require 10-12 times of their annual income to build their retirement corpus, up from 8-9 times in the 2020 survey
- 10% of those who have a retirement plan, seek proper financial planning services from a registered investment advisor
For the survey, 3009 respondents participated from 9 metro and 6 non-metro cities. This sample was studied on the basis of their attitudes and behaviours towards financial planning, especially planning for their retirement.
