Why Pension Plans
Why pension plans had become why not a pension plans in the last one to two years. Pension plans play a dual role as life insurance cover as well as for retirement planning, India is a big country with more than 100 Crore population. LIC Pension plans are guaranteed for life with insurance cover. It is not easy for the Government to provide Pension for all. In Western countries, pension planning is done by the Government for the entire population. Today the United States of America is having 1/4 of India’s population. It is easy for those countries with less population to plan for social security with the Health and Pension system. India is the second-most populous country in the world, not so easy to provide Pension to each and every Indian citizen. In recent years, the Pension plan has become a need for all. The future is going to be very dangerous if you are not prepared for your retirement. For example, If a person works for 25 years to 60 years then the next 60 to till he lives, needs to live without Salary.
That means after retirement, every day is Sunday and every day would be only expenses and no income. According to the Economic Times survey, only 49% are aware of Pension and its need in the future. Life is going to be very tough if each individual fails to plan for his retirement. A simple calculation says, Today an individual requires 3 meals a day, including spouse 6 meals a day. For example, the cost of the meal is Rs. 50/-, then 6 meals a day would be 300/- per day. This is the food expenses for self and spouse. So for food only Rs. 10,000/- is required per month roughly. Other expenses are separate.
After 15 years, what would be the scenario?