The New Era of Retirement Planning in India

Traditionally, retirement planning in India was often postponed until one's 50s, after achieving other life milestones. However, this trend is rapidly changing, especially among millennials and Gen Z professionals. With the median age in India just over 28, nearly 60% of retirement policy buyers are now under 40, signaling a shift towards early financial planning.

Young, Aspirational, and Financially Savvy

Only about 11.6% of retirement-oriented insurance policy buyers are above 50, with the majority being young professionals under 40. This demographic is keen on building a corpus that lasts decades, driven by factors like longer life expectancy, rising inflation, and the absence of guaranteed pensions in the private sector.

Market-Linked Products Take Center Stage

Contrary to the belief that Indians prefer traditional insurance and fixed deposits, ULIPs now dominate retirement portfolios, accounting for over 98%. This includes Retirement ULIPs and Pension ULIPs, reflecting a trust in market-linked growth to outpace inflation and the flexibility these products offer.

Small Towns, Big Dreams

Remarkably, 75% of retirement policies come from tier-2 and tier-3 cities, showcasing the democratization of wealth-building across income brackets. Affordable premiums and the ability to start small have made retirement planning accessible to a broader audience, marking a new phase in financial inclusion and aspiration.

NRIs Joining the Retirement Planning Wave

Non-resident Indians are also part of this shift, contributing about 10% of policy volumes. Despite starting later, their average investment size is significantly higher, indicating confidence in India's economic fundamentals and the desire for a retirement income anchored in India.

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