Young Indians want to retire early; few are financially ready: Survey

They expect monthly pension of more than Rs 1 lakh but only 11% confident their investments will be sufficient, it says

Young Indian professionals wish to retire early but most of them do not save enough to make that dream a reality, according to a survey by professional services firm Grant Thornton Bharat. The survey was conducted by Grant Thornton Bharat gathered responses primarily from private sector employees aged 25–54. It focused on retirement planning, pension expectations, and financial awareness using structured questionnaires.

 

Early retirement, but limited savings

 

As many as 43 per cent of respondents aged 25 or younger wish to retire between 45 and 55 years, much earlier than the conventional retirement age of 60. Around 74 per cent of all survey participants said they contribute 1 per cent to 15 per cent of their monthly salary as retirement savings.

 

“There is a clear mismatch between expected retirement age and financial contribution patterns,” said the report, adding that high aspirations aren’t matched by prudent investment behaviour.

 

High pension expectations, low confidence

 

While over half the respondents said they expected a monthly pension of more than Rs 1 lakh, only 11 per cent were confident that their investments will be sufficient. “This stark disparity highlights a significant preparedness gap,” the survey noted.

 

Only 3.65 per cent of respondents said they are “extremely confident” their pension products would meet their needs after retirement, while a 42 per cent said they are “not at all confident.”  ALSO READ | HNIs aim for early retirement but low savings, planning hold them back

Dependence on traditional products

 

Most respondents continue to rely heavily on traditional pension schemes. Nearly 83 per cent said their retirement planning is based on the Employees’ Provident Fund, gratuity, or the National Pension System (NPS). Private annuity plans, which can offer stable income post-retirement, remain underutilised; 76 per cent of respondents have not invested in them.

 

Half of the respondents admitted to having no knowledge about the Atal Pension Yojana, a government scheme aimed at securing retirement income for informal workers. Meanwhile, only 17 per cent said they understood their pension calculations “very well.”  ALSO READ | National Pension Scheme: Can you plan early retirement with this plan?

 

What needs to change

 

The findings underscore the need for financial education and reforms in pension planning. “Financial institutions should consider introducing more guaranteed income products, such as annuities, to cater to the demand for stability,” said the report.

 

It called for reforms in NPS and improving awareness about pension schemes and retirement planning.