as mass products by employers are just not enough. If retirement needs are specific to the individual, then retirement plans must be too.
There are various financial savings options to plan for ones retirement. The Pension Fund Development and Regulatory Authority, set up in 2003, regulates three broad types of pension schemes — the government pension schemes (such as the one that covers Amit Chandra), the National Old Age Pension Scheme for people living below the poverty line, and the private pension schemes / funds.
Pension plans from life insurers could be another lucrative option, which not only lets you plan for retirement in a structured systematic and disciplined manner but also provides protection against uncertainties. So much so that there are plans today which even ensure a guaranteed financial support for your spouse’s retirement even in your absence. These plans offer a wide range of options in terms of various benefits and payment schemes. Subscribers can opt for a payment plan based on their financial capacity, their projected needs after retirement and on the basis of the age at which they plan to retire.
A pension plan can be purchased on a one-time lump-sum payment (a better choice for those close to the age of retirement) or deferred payment of regular annual premiums over a period of time, which younger people can opt for more comfortably. The benefit of income after retirement can be disbursed immediately upon the subscriber’s retirement or, alternately, the subscriber could choose to defer the payment wholly or in part till such a time as he or she requires it; the monthly annuity would be calculated accordingly. Plans also allow for life-time annuity payments or payment for a guaranteed period of time. Some plans also offer the return of annuity amount to nominees, leaving behind a legacy for them.
Today, Amit and his wife are considering selling their two-bedroom apartment in Mumbai and moving to a smaller, cheaper town — they are not sure where! They still need a place where advanced medical care is available. This unhappy choice also means that will not spend their golden years comfortably in the security of a familiar neighbourhood, with an established support system run by long-known people, among old friends and regular acquaintances.
For Amit’s daughter, such an unhappy choice is no choice — she and her husband have begun to plan their future on realistic projections of