Retirement planning has become the top financial priority for Indians, with preparedness dropping from 67% to 37% in 2023, according to a report by PGIM India Mutual Fund. This shift highlights a move from fear-driven security to aspiration-driven ambition in financial planning, blending protection with progress and lifestyle freedom. Lifestyle upgrades, entrepreneurship, and personal fulfillment are now gaining prominence over family security and health emergencies.
Mutual funds have emerged as the preferred retirement vehicle, with a significant rise in choosing products from distributors, increasing from 44% to 62% in 2023. The adoption of mutual funds for retirement has also increased from 24% to 35%, with growing interest in NPS, PPF, and retirement-focused funds. CEO of PGIM India Asset Management Private Limited, Abhishek Tiwari, sees the decline in readiness as a positive evolution, indicating a shift towards actively building a future and self-driven security.
Despite a decrease in alternate income adoption to 25%, the intent to pursue it has risen to 44%. This trend is attributed to rising affluence and the impact of the pandemic, which have propelled retirement planning, lifestyle upgrades, and entrepreneurship to the forefront. Ajit Menon, Senior Advisor at PGIM India Asset Management Private Limited, notes the shift towards self-oriented goals alongside traditional family-centric concerns.
