Corpus of Rs 65,00,000 ideal for retirement: ICICI Prudential survey

ICICI Prudential life insurance survey has revealed that a corpus of about Rs 65.4 lakh is considered ideal for retirement by Indian respondents.

The survey, titled "Is India prepared for retirement?" was done in tandem with Quantum Consumer Solutions which surveyed over 1,100 individuals to understand the consumers’ attitudes toward retirement, money, and annuity plans. The survey provides deep insights from diverse perspectives, including government employees, private sector employees, businessmen, self-employed, and retirees across the age bracket of 45 to 75 years from cities with a population of more than 2 million.

Retirement is seen as a time full of possibilities, according to the findings. One can make a fresh start and live life the way they want to at this time. A lot of people view it as a phase of maintenance. Continuing with the current lifestyle into retirement is the top priority, as indicated by 83% of respondents. The respondents indicated that their retirement goals include enjoying life, staying connected with friends, travelling abroad, feeling financially secure, and having peace of mind in this new chapter of their lives. Over two-thirds of those surveyed have mentioned, they worry about inflation impacting their retirement savings, and consequently, their lifestyle. At the same time, 67% of the respondents highlighted the need to have adequate retirement corpus to take care of medical expenses if stuck with a terminal illness during their retirement.

Currently, 11% of total income is channelled towards retirement-specific savings. To prepare for retirement, individuals are recognising the importance of products that are risk-free and offer guaranteed returns for life, such as annuity plans. Regular income for self and spouse is provided by annuity plans. The survey shows a high interest in investing in annuity plans among people who have not yet done the same.

The emergence of a second front was revealed by the findings. A group of people who are prepared to lead a financially independent life. They start investing for retirement even before they turn 40 and put aside an average of 17% of their income towards retirement. They invest in retirement/annuity plans, as well as fixed deposits, in order to become retirement ready.

Commenting on the findings of the study, Manish Dubey, chief marketing officer, ICICI Prudential Life Insurance, said, "India’s retirement population is growing rapidly and is projected to show a 41% increase by 2031. Additionally, with increasing life expectancy, a large segment of people will be looking for solutions to plan for a longer retirement.

According to the findings of the study, a majority of people want to invest in annuity products as part of their retirement planning.

In contrast, only 32% of respondents have actually invested in annuity products, highlighting the gap in retirement planning.

Regular income is what retired people look for. Annuity products offer regular guaranteed life-long income, therefore a robust retirement plan should include this product in the portfolio. New-age annuity plans like ICICI Prudential Guaranteed Pension Plan Flexi enables consumers to make regular contributions and systematically build retirement savings.