If you don’t find the amount that you should ideally save each month for retirement shockingly high, then you have most likely made a mistake in calculating the amount that you will need (as I have written previously in this newspaper). Here are six reasons why it is so difficult to build an adequate retirement corpus.
Longevity risk
A 60-year-old upper-middle-class Indian woman is, on average, likely to live till the age of 83. So, if she plans for expenses till the age of 83, then there is a 50 per cent probability that she will live longer than that, and run out of money. There is no tax-efficient way to mitigate this risk in India.
