Retirement planning for urban women

Key Takeaways

Retirement planning promotes financial stability for women. Making smart investments early can help women maintain quality of life post-employment
Retirement planning eliminates dependency and bolsters financial freedom

City life keeps us immersed in the hustle and bustle of daily activities. This is especially true for urban women with a family and a career to care for. Women play important and diverse roles in shaping the domestic and corporate landscapes - yet, amidst professional growth and familial commitment, an essential aspect is often overlooked - retirement planning.

Unlike their male counterparts, women often face distinct hurdles to financial security after they retire. For example, consider the gender pay gap in India. A 2020 research paper published by Sattva confirms an average pay gap of 33% between men and women in India.

Additionally, studies have revealed that women have an average life expectancy of 70 years, whereas for men it is 67 years. These facts highlight the truth that women live longer but make less money, consequently impacting their lives negatively post-employment.

These, among other crucial reasons, lay much emphasis on the importance of retirement planning for women

Planning for the future

With an increasing number of women joining the Indian workforce, it is of utmost importance to plan for the future and make strategic investments aimed at retirement.

National Pension Scheme

NPS is a government initiative with a focus on providing citizens with retirement benefits. It is a regulated scheme that allows individuals to accumulate a retirement corpus by making regular contributions. The minimum yearly contribution must amount to Rs. 6000.

Public Provident Fund

PPF is another government-backed long-term saving scheme that allows individuals to make up to 7.10% p.a for a period of 15 years. However, the tenure can be extended upto 20, 25, and 30 years respectively.

Senior Citizen Saving Scheme

SCSS is also a government-sponsored investment scheme for individuals above the age of 60, with a minimum investment criteria of Rs. 1000 and max of Rs. 30,00,000. The maturity period is 5 years with an extension available of 3 years. This scheme offers an interest rate of 8.2% p.a

POMIS

The Post Office Monthly Income Scheme is considered a safe investment option delivering a return of 7.4% p.a. As the name suggests, the interest disbursement in the scheme is monthly and requires a minimum locking period of 5 years, which can be extended.

Annuities

Annuities are a popular retirement investment and offer a stable and predictable income stream. Many annuities provide the option of lifetime income, making sure the investor receives income for the rest of her life.

Conclusion

Retirement should not be considered the end, but instead the beginning of a transformative phase in a woman's life. A phase that can be financially secure by making prudent investments throughout her career.

Retirement planning for women is a matter that requires a great deal of attention. Do not hesitate to work with financial planners to help you put aside a part of your income and secure your future.