1PGIM India Mutual Fund Retirement Readiness Survey 2023
PGIM India Mutual Fund
Retirement Readiness Survey 2023
Building financial wellness into our future.
Knowledge Partner:NielsenIQ
2PGIM India Mutual Fund Retirement Readiness Survey 2023
About Us
PGIM
PGIM is the global investment management business of Prudential Financial, Inc. (PFI) USA,
with USD 1.22 trillion
1
in assets under management. With offices in 18 countries, PGIM’s
businesses offer a range of investment solutions for retail and institutional investors around the
world across a broad range of asset classes, including public fixed income, private fixed income,
fundamental equity, quantitative equity, real estate and alternatives. PGIM manages 161 of the
largest 300 global pension funds. For more information about PGIM, visit pgim.com.
Prudential Financial, Inc. (PFI) of the United States is not affiliated in any manner with
Prudential plc, incorporated in the United Kingdom or with Prudential Assurance Company, a
subsidiary of M&G plc, incorporated in the United Kingdom. For more information, please visit
news.prudential.com
1
All information current as of June 30, 2023 per PGIM internal data. PGIM is the investment management business of
Prudential Financial, Inc. (PFI). PFI is the 11th largest investment manager (out of 434 firms surveyed) in terms of worldwide
institutional assets under management based on Pensions & Investments’ Top Money Managers list published June 2023. This
ranking represents institutional client assets under management by PFI as of December 31, 2022. Participation in the P&I
ranking is voluntary and open to managers that have any kind of U.S. institutional tax-exempt AUM.
PGIM India Mutual Fund
PGIM India Mutual Fund is a wholly owned business of PGIM, the global investment
management business of the US based Prudential Financial, Inc. (PFI). PGIM India Asset
Management is the full-service investment manager of PGIM India Mutual Fund, offering a
broad range of equity and fixed income solutions to retail and institutional investors throughout
the country. We manage 20 open-ended funds operated by 16 investment professionals. In
addition to managing our investors assets through domestic Mutual Funds, we also offer
Portfolio Management Services, Alternatives, Offshore Funds and Advisory Services. The fund
house leverages the strength and stability of PGIM’s 145-year legacy to build on its decade long
history in India.
Headquartered in Mumbai, PGIM India Mutual Fund has a presence in 27 cities across the
country including branches in Ahmedabad, Bangalore, Chennai, Delhi, Hyderabad, Kolkata
and Pune. PGIM India Mutual Fund brings a rich blend of global resources, intellectual acumen
and local investment expertise and is committed to designing superior and meaningful, wealth-
building solutions for our investors. PGIM India provides unique training and educational
programs for building exceptional capabilities and best business practices for its business
associates. For more information, please visit pgimindiamf.com
3PGIM India Mutual Fund Retirement Readiness Survey 2023
Foreword 4-5
Indians Undergoing Lifestyle Changes 7-12
Indians Getting Sensitized Towards Planning for Retirement 13-23
Advisors & Employers as Key Drivers of Financial Success 24-28
Conclusion 29
Content
Important Disclosures: PGIM India Mutual Fund appointed NIQ for conducting a survey among 3009 Indian adults aged between 26-60 years
(26-40: 19%, 41-50: 38%, 51-60: 43%) inclusive of both Men (80%) and Women (20%) belonging to *NCCS A/B (72%:28%) covering Salaried (54%),
Businessman/ Self-employed professionals (46%). The survey was conducted in 15 cities (Metros: 60%, Tier 1: 40%) across India. Data was collected
using Face to Face interviews. The survey was fielded between Sep 2022 – Dec 2022. The margin of error for this study is +/- 3%. The survey holds
data from the earlier PGIM report conducted in 2020 as well.
2020 Prudential Financial, Inc. (PFI) and its related entities. PGIM, the PGIM logo, and the Rock symbol are service marks of PFI and its related
entities, registered in many jurisdictions worldwide. *NCCS refers to the New Consumer Classification System developed by the Market Research Society of
India (MRSI) and Media Research Users Council (MRUC) to categorize households based on the level of education of the main wage earner and the number of
consumer durables owned by the household.
Mutual fund investments are subject to market risks, read all scheme related documents carefully.
Methodology and Disclaimers
4PGIM India Mutual Fund Retirement Readiness Survey 2023
Foreword
Population ageing is poised to become one of the most significant social
transformations of the twenty-first century, with implications for nearly all
sectors of society, including labour and financial markets, the demand for
goods and services, such as housing, transportation and social protection,
as well as family structures and intergenerational ties. This is according to a
United Nations report which also states that globally, the population aged
65 and over is growing faster than all other age groups.
1
. Living longer is an
underappreciated risk into retirement and leaves everyone grappling to find
solutions. Geo-political and climate risks add to economic risks increasing the
possibility of accidents to everyone’s financial journey.
Add to that the fact that we do not have a conventional and comprehensive
social security plan in India. The challenge in front of every stakeholder is
real. How do we make lives better and solve for the financial challenges faced
by consumers in a changing world?
In the backdrop of a robust survey done in the year 2020, PGIM India
Mutual Fund, a wholly owned business of PGIM, the global investment
management business of Prudential Financial, Inc. U.S., recommissioned
NIQ, the leaders in global measurement, to conduct another round of survey
with 3009 Indian participants, residing across 9 metro and 6 non-metro cities,
to gauge attitudes and behaviours towards their overall financial planning,
especially planning for their retirement. This also aided the fact that the
findings could be compared in the light of impact of the pandemic on one’s
behavioural, attitudinal and financial aspects of dealing with money.
Let me take you through some of the key findings from the survey. We saw a
visible attitudinal and a behavioural shift overall, where the pandemic seems
to have impacted certain significant aspects. The emphasis on ‘Self-Identity’,
‘Self-Care” & ‘Self-Worth’ have emerged as more important than ever
alongside fulfilling roles and responsibilities towards ones family.
According to Reserve Bank of India (RBI) data, annual financial liabilities of
households rose by 5.8% of GDP in FY23, compared with 3.8% in FY22. The
central bank notes that the primary cause of decreased savings and increased
borrowing is the combination of stagnant or declining household incomes in
the face of rising inflation. In our recent survey, the allocation of income has
not witnessed any meaningful change when it comes to consumer durable
and personal loans as a current liability as compared to 2020.
Overall, the allocation of household income towards paying loans constituted
18% in 2023 as compared to 16% in 2020. Interestingly, within loans, there
has been a conscious effort towards building human capital, where 5% of
income is allocated towards skill development/education loans in the current
survey.
While money management is associated with discipline, safety, competence,
being respected and freedom, it is largely divided into 4 main pillars—
savings, expenses, protection, and investment.
The impact of the pandemic is also seen in terms of planning for the future,
especially for the long term. There is heightened awareness towards macro-
economic factors like inflation (56%), cost of living and slowdown in economic
The pandemic has
prompted people to
pay more attention
to relationships,
improving bonds with
family and friends.
Ajit Menon
CEO
United Nations (World Population Ageing Report).
5PGIM India Mutual Fund Retirement Readiness Survey 2023
conditions. Further, 52% cite the health of family members as key cause of
worry. Additionally, not having an alternate source of income is worrying
39% of Indians, compared to 8% in 2020 survey results.
Retirement is viewed as a gateway to pursue goals. The qualitative
insights drawn from the survey, evidence that the participants post their
retirement—wish to travel and see the world, spend time with their family,
spend money on their family’s lifestyle and future, and upgrade their own
lifestyles to celebrate a life well lived. Encouragingly, a larger percentage of
respondents (67%) say that they have planned for retirement as compared to
49% in the previous survey.
In addition to the above, pandemic has brought some key changes in
peoples’ perception, their behaviour and attitudes towards health, life
and money management. For instance, in the 2023 survey, we found that
participants residing in metros, with income below 50k and not having a
second source of income have different financial and behavioural priorities
as compared to Tier 1 cities - Behaviour (consumption of nutritious
food, self-hygiene, learnt to cook, etc.) and Attitudinal priorities (reading
literature/books, emphatic towards others, think more before spending a
significant amount of money). These changes are nudging people to plan
their finances more carefully by seeking professional advice.
The survey also presented some insights on whether respondents seek help
from an advisor to chalk out a financial plan, the qualities they look for in
an advisor and the people who influence them to approach an advisor. The
survey finds, that less than 1/3rd of respondents have taken advice from a
financial advisor, out of which 2/3rd take advice from insurance agents. Also,
3/4th of respondents get influenced by family/friends to approach an advisor.
Finally, to nudge people towards saving for this important goal, employers
can also play a key role in building mass awareness and impact lives, by
supporting their employees to plan for retirement. Even though the loyalty
of over 55% individuals to their organizations has grown, a significant
majority, about one third, experience financial anxiety. Out of which around
2/3rd believe it negatively impacts their productivity for at least half of the
day.
What has changed incrementally from the last survey is the desire to express
one’s self-identity much more alongside family needs, worrying more about
protection from inflation and economic downturns. We see differences
in perception based more on income levels and whether one is living in a
metro or a Tier 1 cities. As compared to the pre-pandemic levels, joint family
does not seem to have the same kind of cushion effort, since more number
of people living in a nuclear family setup seem to believe that they feel
financially free and secure.
Given the dynamics of accessibility, most of those who do have a plan for
retirement seems to equate it with insurance and seek advice from insurance
agents and advisors rather than looking at it more comprehensively to
include savings and investment aspects and approaching financial planning
services or Mutual Fund Distributors and Registered Investment Advisors.
There is much to do for all stakeholders to build on the new found
awareness post the pandemic for long term planning, which takes a holistic
view of finances comprising savings, insurance and investing.
Inflation is a key
concern for Indians
while planning for
retirement.
6PGIM India Mutual Fund Retirement Readiness Survey 2023
Retirement Planning Picks Pace in Metros
Today, Indians are focusing on their child’s education and financial security
of their spouse and children along with maintaining their standard of living.
Additionally, retirement planning and planning for medical emergencies are
also gaining importance within Metros. Macro-economic shifts and the impact
of pandemic have guided Indians to plan and maintain their expenditure
keeping them ready to deal with sudden future exigencies. This shows a
recognizable shift from the last report findings, conducted in 2019, which
showed reluctance to commit for long-term financial commitments to financial
planning.
Saving for unexpected events is gaining importance post
Covid
CHILD’S NEEDS: Providing for child’s future
Majorly driven by consumers in Metros, and cities having lower monthly income (up to 50k)
CHILD’S SECURITY: Financial security for my children
Driven by consumers in Metros
SECURITY OF SPOUSE Financial security for my spouse
Driven by Metros and Lower New Consumer Classification System (NCCS)
MEDICAL EMERGENCIES: Financial security for medical emergencies/expenses
Driven by consumers in Metros with lower monthly income (up to 50k)
STARTING/ GROWING THEIR OWN VENTURE: The startup revolution in India
catching up.
Driven by Metros
RETIREMENT: Planning for my life after retirement
Driven by consumers in Metros and women and those having a personal income of
up to 50K.
BEING FIT: Being Physically and mentally fit
Driven by consumers in Metros
KEY SURVEY FINDINGS
The Financial Priorities of Indians
IMPROVING LIFESTYLE: Improving my standard of living/lifestyle
Driven by consumers in Metros having lower monthly income (up to 50k)
Retirement moved to
6th position in the list
of financial priorities
from 8th in 2020
survey.
7PGIM India Mutual Fund Retirement Readiness Survey 2023
Indians Undergoing
Lifestyle Changes
8PGIM India Mutual Fund Retirement Readiness Survey 2023
What money means to Indians?
Traditionally, money served as a safety net, enabler and a medium to gain
self-respect. However, with the evolution in lifestyle, newer codes have
evolved. Money is also associated with a sense of freedom and gratification
1
.
The negative facet to money is largely associated with the mismanagement
of it, which results in social embarrassment or a sense of lack of control. This
could lead to building up of debt and liabilities.
Thus, money management has become a very important aspect for Indians,
and more so post the pandemic. This is largely divided into 4 main pillars—
savings, expenses, protection, and investment. However, the connotation of
these pillars has also evolved post the pandemic.
Similar to what we saw in 2020 survey, urban Indians today are saving and
investing less, while allocating nearly 59% of income to current expenses.
Overall, the household investments, savings and expenses remain consistent
over 2020 to 2023, with a marginal decrease in allocation to insurance from
13% to 11% in 2023. Out of the 59% of household income allocated towards
expenses, a good 38% is further been allocated towards just household
expenses, which is consistent with the last survey. However, the overall
allocation of income towards paying of loans have increased marginally from
16% to 18% (home, education, personal and consumer durable) in 2023
survey results.
Income allocation to
loans and liabilities
increases with
increase in personal
income.
Current Income Allocation of Indians
Insurance (Life/Health/General) Investments Savings Expenses
59%
18%
12%
11%
2023
Base: 3009
Rent 3%
Skill Development / Education
Loan* 5%
Loans (Home, Consumer Durable,
Personal-13%)
Rent liability makes up 15% of total expense
who live in a rented house
Millennials seem to be more inclined to take
consumer durable and personal loans
Respondents living in Tier 1 cities and having a
secondary source of income allocate a portion towards
education including skill development of self
*Skill development/education loan is added in the 2023 study
Household Expenses 38%
Respondents living in metros allocate more income
to household expenses as compared to those living
in Tier 1 cities
1
Insights drawn from qualitative research done by NielsenIQ, in 2022 across 15 cities during Sep – Dec 2022
9PGIM India Mutual Fund Retirement Readiness Survey 2023
Goals related to generating wealth for Indians
How Indians think they can generate wealth to fulfill
their financial goals?
Maximizing returns on investments (50%)’ and ‘being financially secure
(46%)’ are two key goals when it comes to increasing wealth, followed by
starting a new venture (37%) and reaching top positions in current jobs
(36%). Though, only 1/4th i.e. 24 % respondents reported that they
consider having a financial plan to accommodate their financial goals as a
way to to generate wealth.
The research evidenced that individuals having less than 75k monthly
income focus mainly on generating more returns and being financially
secure. However, the focus moves to other nuanced goals like reaching top
positions in current jobs and generating passive income when the income
levels increases (reported by individuals having income above 75k monthly).
We also found that ‘generating high/maximum returns’ as a goal to generate
more wealth is considered primarily by those who are worried about being
not prepared for retirement and by young age self-employed individuals.
Whereas, goals like ‘starting a new business/venture’ is mostly reported by
young (26-40 yrs) & older businessmen, and older self-employed consumers.
With lower income,
there’s a higher
focus on generating
more returns & being
financially secure. As
the income increases,
reaching higher
position in one’s
current workplace and
developing a passive
income source takes
precedence.
We see that the allocation to components of household expenses have
been varying, maybe due to the impact of pandemic, where we see a sharp
decrease in the allocation of household income towards rent from 7% in
2020 to 3% in 2023. Also, it reduced from 7% to 4% for home loans in
2023. The allocation towards paying of consumer durable and personal
loans remain same (9%). Additionally, we saw a good traction towards skills
development and taking education loans, where people are spending 5% of
their household income towards it.
The amount one is capable of allocating to different ends is also related to
how one can generate it. Let’s see what are the top ways through which
Indians can generate wealth.
Invest time online to generate income from blogs/vlogs, affliate marketing etc.
Diversify my portfolio to minimize risk
Regular income from stock market
Monetise my hobbies
Financial plan to accommodate most or all of my financial goals
Save my taxes
Improving new skills
Passive income
Earn interest
Reach top positions in my current workplace
Start a venture/business
Be financially secure
High maximum returns
3%
12%
13%
22%
24%
30%
31%
32%
33%
36%
37%
46%
50%
Base: 3009
10PGIM India Mutual Fund Retirement Readiness Survey 2023
Indians underwent changes after pandemic
Pandemic has been a key driver for many in several ways. In the survey,
we found that 48% of Indians underwent changes with respect to their
attitude, behavior, and finances/financial planning. This is majorly driven
by respondents from Tier 1 cities, salaried class and NCCS* A segment.
Amongst the 48% of respondents, who underwent changes after pandemic,
100% of them reported experiencing financial changes, 88% reported
they experienced behavioral changes and 78% reported they experienced
attitudinal changes.
While stating top changes undergone in attitudinal, behavioral and financial
aspects, respondents from metros and Tier 1 cities are found to be consistent
in their responses relative to the overall dataset for all three types of changes
reported.
However, respondents from metros have had a significant impact of the
pandemic leading to changes in their financial and behavioural priorities as
compared to Tier 1 cities; behaviour & attitudinal priorities changed majorly
for respondents who do not have a second source of income and have a
personal income of below 50K.
10
48% respondents
reported that pandemic
has led to changes in
attitude, behavior, and
planning finances.
Post Pandemic:
Indians have
started putting more
emphasis on long-
term commitments like
medical emergencies
and retirement
planning, in addition to
family security.
Changes Indians Underwent After Pandemic
52%
48%
Base:- 3009
Yes
No
Base:- 1433
(Top 4 Changes)
Financial changes
1
100%
88%
2
Behavioral changes
78%
3
Attitudinal changes
“Expenses towards
groceries/daily essentials
increased”
“Savings/allocation towards
medical expenses
increased”
“Health policy/mediclaim
premium increased”
“Due to reduced social
interaction expenses on
food/online shopping
increased”
“Consumption of nutritious
foods increased”
“Inculcated the practice of
self-hygiene”
“Increased attention
towards safeguarding
physical & mental health”
“Spend more time with the
family when free”
“Realized the importance of
financial stability”
“Tend to think more before
spending a significant
amount of money”
“More cognizant of my
savings and financial back
up”
“More empathetic towards
others”
*Please refer to the methodology on page 3 for the definition of NCCS.
11PGIM India Mutual Fund Retirement Readiness Survey 2023
Indians become more financially conscious, planned and
disciplined
Post the pandemic, while Indians continue to remain aspirational, there
has been a renewed focus on health and fitness. The rise in importance of
retirement planning and planning for contingencies is a testimony to the
same. Let’s take look at how financial practices of Indians have evolved post
pandemic
2
.
2
Insights drawn from qualitative research done by NielsenIQ, in 2022 across 15 cities during Sep – Dec 2022
Health, fitness &
saving for emergency
is gaining prominence.
Evolved
Practices
Saving to incur short term
expenses
Disciplined payments, seek a
balance between fixed expenses
and discretionary lifestyle expenses
More aware about unprecedented
expenses, seek comprehensive
protection for health, life, vehicle &
business
Maximization of wealth, curious
consumers search for newer
avenues for investments
Traditional
Practices
Building a corpus to secure
future
Preventing the erosion of core
funds/savings
Surplus cash for emergencies
Loosely tracked expenses, save
whatever is left
Savings
Expenses
Protection
Investment
12PGIM India Mutual Fund Retirement Readiness Survey 2023
Indians define their ‘Identity’ with equal weights to self-
care & fulfilling roles & responsibilities towards others
Traditionally, being able to fulfill commitments & responsibilities towards
work, family and future are seen as an important marker of one’s success or
failure as an individual. However, the qualitative research findings highlight
that ‘Identity’ & ‘Self Worth’ are no longer just limited to fulfilment of
roles & responsibilities, but is also about taking care of & knowing oneself.
Broadly they focus on—their respective work, family, future and self
3
.
Indians want to be
in control of their
finances without
compromising their
aspirations.
In a nutshell, Indians reported ‘being financially’ secure is a priority and
an essential driver to fulfil their personal aspirations and responsibilities
towards family, work, future and self, but do people plan for it? And if they
do then how and why?
Their Work:
A critical
identity hook –
gives “meaning’
to their life.
Commitment
to their work
adds a layer
of belonging
to their life.
It is the first
conscious step
of creating an
identity.
Their Family:
A reason for
existence – gives
“purpose” to
their life. The
lifestyle choices,
goals and
aspirations are
centered around
their familial
goals.
Their Future:
Their very
own creation -
gives a sense of
“direction” to
their life. Goal
oriented - makes
them feel like
they are slowly
and arduously
working towards
a certain
milestone. Desire
to create a life
and an identity
– one that can be
their very own
legacy.
Their Self:
An orientation
that gives an
awareness about
“who they are &
what they want”.
Taking care of
themselves—
i.e. focus on
their overall
wellness, home
maintenance &
décor, nurturing
relationships
and financial
management
and exploring
interests
like newer
cuisines, art &
entertainment,
sports and
outings etc., were
highlighted.
3
Insights drawn from qualitative research done by NielsenIQ, in 2022 across 15 cities during Sep – Dec 2022
13PGIM India Mutual Fund Retirement Readiness Survey 2023
Indians Getting Sensitized
Towards Planning for Retirement
14PGIM India Mutual Fund Retirement Readiness Survey 2023
Those who planned
for their retirement
generally started
it around 33 years
of age & those who
haven’t intend to start
in their 50s.
Close to half of those
who do not have
retirement plan in
place mentioned
that they do not need
a financial plan to
achieve their goals in
life.
Indians believe they are ready for retirement
The awareness around saving for a long term goal like retirement seems to
be on the rise. This section throws light on the attitude of respondents who
have a retirement plan, whether they stick to their plan, comprehensiveness
of the plan, which instruments they invest in, what motivates them to save
for retirement and more.
The pandemic was probably the factor making people realize the importance
of saving/investing leading to increase in people planning for it.
Managing health related expenses, systematic investment, and leading a
luxurious life are triggers for active planning.
Encouragingly, almost 67% of respondents reported that they have a
retirement strategy in place. Post pandemic, a significant jump is witnessed
in the percentage of Indians reporting to have a retirement plan— from
49% in 2020 survey results to 67% in the current run.
The results are found to be consistent relative to the overall percentages
for all income groups and gender groups, even for metros. A bit higher
percentage of respondents –residents from NCCS* A (70%), Tier 1 cities
(73%) and people in government jobs (74%) reported they have a retirement
plan in place as compared to the overall percentage of 67%.
After the pandemic, the percentage of respondents who do not have a
retirement plan dropped from 51% reported in 2020 survey to 33% in 2023
survey.
*Please refer to the methodology on page 3 for the definition of NCCS.
67%
33%
Base:- 3009
Yes No
+18 percentage
point from
2020 survey
Indians Having A Retirement Plan In Place
15PGIM India Mutual Fund Retirement Readiness Survey 2023
Those who planned for retirement (67%), overall have a positive outlook
about work and life. Those who feel prepared for retirement (67%), have a
sense of good health (68%), acknowledge that they have a secure job (69%)
and less job related stress (68%) and are prepared with a contingency plan
(in case money gets exhausted after retirement, 88%). We see a significant
increase in percentages for all these aspects in 2023 from 2020. A majority
of them have also stated that they have an alternate source of income
(73%), which marginally reduced from the 2020 survey results i.e. 75% of
respondents reporting it.
Among these 33% respondents who have not made any retirement plan
yet, a good majority (40%) mentioned that they do not need a financial plan
to achieve their goals in life. The remaining mentioned that they will start
planning for retirement from the age of 50 years. This age group is largely
the same over the last 2020 survey as well.
Additionally, respondents who mentioned they do not need a financial
plan (40%) are majorly residing in ‘Tier 1 cities’; having ‘50K-75K personal
income’; mostly ‘self-employed’; between ‘51-60 yrs.’, and ‘don’t have an
alternate source of income’ and never given a thought to it. However, this
percentage also dropped to 40% in 2023, from 55% (out of 51% of Indians
with no retirement plan), driven majorly by consistent demographic
features.
Planning for
retirement is found
to be associated
with positive attitude
towards work and life.
Planning for retirement brings positivity in life
73%
68%
69%
68%
88%
75%
54% 54%
55%
81%
Alternate
incom e
Health view Job security Job stress Contiengency
Plans (in case
money gets
exhausted after
retirement)
2023 2020
Base: 3009
Aspects Associated With Retirement Readiness
16PGIM India Mutual Fund Retirement Readiness Survey 2023
Amongst the 67% of respondents who reported having a retirement plan,
63% of the respondents feel that their retirement plan is comprehensive
i.e. it covers all the goals and expenses. This is largely reported by Tier 1
cities and New Consumer Classification System (NCCS*) A respondents; the
respondents from 41-50 years age range and the ones who reported to have
a secondary source of income.
Those who reported having a retirement plan (67%), a significant
percentage of respondents reported that they adhere to it diligently (54%)
and other 41% stated that they adhere but miss out only on a few aspects.
From 95% of those
who have a retirement
plan adhere to it -
54% say they follow it
diligently and 41% say
they miss out only on a
few aspects.
Indian investors prefer investing in Mutual Funds over
direct Equity/Shares and Exchange Traded Funds (ETFs)
Additionally,
Retirement funds are
gaining traction from
Indian investors.
Kinds of Investments Indians Prefer Investing Post Retirement
Indians believe they adhere to a comprehensive
retirement plan
Comprehensiveness of Retirement Plan
63%
33%
1%
Covers all the goals & expenses Covers most of the goals & expenses
Covers a few of the goals & expenses
*Base:- 3009
59%
52%
50%
37%
23%
15%
13%
12%
7%
5%
71%
52%
26%
25%
10%
5%
3%
6%
18%
4%
Fixed
Deposit (FD)
or Recurring
Deposits
(RD)
Annuities
or
Insurance
Policies
Gold Post Office
Saving
Scheme
(POSS)
Mutual
Funds
National
Pension
Scheme
(NPS)
Public
Provident
Fund (PPF)
Chit Funds Equity
(Stocks/shares)
or Exchange
Traded Funds
(ETF)
Bonds or
Debentures
2023 2020
Base 3009
*Please refer to the methodology on page 3 for the definition of NCCS.
17PGIM India Mutual Fund Retirement Readiness Survey 2023
Mutual Funds show
more traction over
direct Equity/Shares
and Exchange Traded
Funds (ETFs).
Indian investors seem to prefer investing in fixed/recurring deposits and
annuities/insurance, followed by gold and Post Office Savings Scheme
(POSS). However, investments in mutual funds is also gaining traction
(increased to 23% in 2023, from 10% in 2020 survey), over equity stocks/
shares investments and Exchange Traded Funds (reduced to 7% in 2023
from 18% in 2020 survey).
In addition to this, a very significant aspect to highlight is – Indians are
getting sensitized about saving into retirement schemes like National
Pension Scheme (NPS), which constituted 15% of the overall share in
comparison to only 5% in 2020 survey and Public Provident Fund (PPF) is
preferred by 13% of respondents in comparison to that of only 3% in 2020
survey.
Indians with a retirement plan in place are bit more open to mutual funds
as compared those who don’t have one: In the 2023 survey results, we
found that the respondents who either have a financial plan in place or do
not have one, both majorly invest in fixed income and annuities, but the
ones who have a plan in place also prefer mutual funds a bit more (24%)
than those who do not have a retirement plan (21%). On the other hand,
those who do not have a retirement plan in place prefer investing in gold
(53%) and Post office Saving Schemes (POSS); 38% a bit more than those
who have a plan in place (49% in Gold and 36% in POSS).
Investments Indians Make With & Without Retirement Plan
Fixed Income Or Recurring Deposit
Annunities Or Insurance Policies
Gold
POSS
Mutual Funds
National Pension Public Scheme
Public Provident Fund
Chit Funds
Equity Or ETFs
Bonds
51%
63%
43%
57%
49%
21%
17%
5%
5%
6%
12%
12%
14%
13%
38%
Those who have a retirement plan Those who do not have a retirement plan
53%
36%
14%
24%
7%
18PGIM India Mutual Fund Retirement Readiness Survey 2023
Inflation, economic
slowdown & instability
of job or income and
unexpected health
expenses are major
worries nudging for
retirement.
Every action is driven by some motivation, and thus planning for retirement
too is nudged by various motivators. Compared to 2020 survey results,
Indians have started worrying more about external events (+47% from
2020 survey) like inflation, economic slowdown and stability of job & income
and the unexpected events (+21% from 2020 survey) like hospitalization/
incurring medical expenses, critical or terminal illness and loss of income
due to recession or natural calamity, which seem to motivate them to plan for
retirement. The percentages remain consistent with 2020 survey results for
the ‘expected’ events category.
The results point to the recent macro-economic changes making people
worry about loss of job or income due to recently seen recession; on the
other hand how pandemic has impacted peoples’ thought processes,
financial preferences and decision-making. This led them to worry about
sudden, unexpected heavy hospitalization or loss of earning member of the
family. Future surveys will tell if this trend holds or is a temporary one.
Respondents from metro (77%), self-employed professionals (83%) & those
with a monthly income up to 50k (78%) are significantly worried about the
unexpected aspects while planning for retirement.
Anxiety about unexpected events nudge Indians to save
for retirement
98%
(0%*)
Expected
Events
80%
(+47%)
External
Events
75%
(+21%)
Unexpected
Events
“Household expenses”
“Regular health
expenses”
“Child/other
dependent’s
education”
“Inflation/Rising
Prices”
“Economic slowdown”
“Stability of job &
income”
“Hospitalization/heavy
medical expenses ”
“Accidental disability
or critical/terminal
illness”
“Loss of income
source due to
recession/any other
calamity”
*[Scores in () indicate % increase from 2020], Top 3 Worries
19PGIM India Mutual Fund Retirement Readiness Survey 2023
Macro-economic and cultural shifts are redefining the
codes for retirement planning
The attention towards inflation doubled and issues like economic
slowdown and lack of alternate sources of income are the worries
related to managing finances post retirement: Very different from what
we saw in 2020, in 2023 survey results -Inflation (56%) stood on the top,
followed by health of self and near and dear ones (52%); slowdown in
economic condition (50%), and cost of living (50%) as major worries post
retirement. Interestingly, the lack of support from family in future (50%),
grabs a significant 5th position in the list of worries, motivating Indians for
retirement planning.
The percentages for inflation, economic slowdown and critical/terminal
illness have doubled, indicating recent macro-economic challenges.
However, similar to 2020 survey results, while thinking about retirement the
lack of organizational support, need to continue supporting children and
paying of loans take a bit of a backseat. Worry about ‘Lack of an alternate
source of income’ showed a significant jump from 8% in 2020 to 38% in
2023.
Lack of family
support in managing
finances is one of
the top 5 worries,
given that —24%
of Indians reported
to be dependent
on family members
post-retirement,
especially on their
spouse.
Indians craving for independence despite worrying about lack of support
from family in managing finances: Around 48% Indians reported that they
worry about the ‘lack of family support in managing finances’, nudging them
to plan for retirement. Ironically, 43% of those who have a financial plan in
place mention that one of the crucial trigger for them to have a plan in place
is ‘to live independently without being dependent on the children/any other
family members’. This increased by 17 percentage point from 26% in 2020
survey results.
Now, this could mean that with growing economic challenges and declining
employment opportunities, Indian parents worry that their children/other
family members may face challenges of their own self-sufficiency and their
ability to provide financial assistance to them might diminish. Thus, they
acknowledge the need to manage their own finances during retirement, and
even of their child’s, if need be.
Worries Related To Managing Finances Post Retirement
22%
33%
34%
37%
39%
50%
52%
55%
39%
50%
28%
23%
2020
Inflation
Health of self/ spouse/ parents
Slowdown in economic conditions
Cost of living
Lack of support from family in future
Lack of alternate source of income
Living for longer than the money saved for
Accidental disability/ critical or terminal illness
Having a trusted advisor
Job security
Loans/ liabilities such as home loan, personal loan,
education loan, business loan etc.
Base: 3009
2023
50%
57%
48%
8%
40%
16%
56%
34%
38%
19%
20PGIM India Mutual Fund Retirement Readiness Survey 2023
The pandemic has had a significant impact on family dynamics. Nuclear
family set ups are regarded as more financially free and secure as
compared to joint families. Significantly, different from what we saw in
2020, after pandemic, Indians have started feeling more financially secure
when they live in nuclear family structure (with or without parents).
Financial security is no longer associated with being
close to family
Sense of Financial Security Across Family Structure
A significant decrease
in percent respondents
feeling financially
secure, if they stay in
joint families.
Leading a better life,
pursuing hobbies and
living independently
are also significant
reasons for actively
planning for
retirement.
Reasons For Actively Planning Finances
This is supported by the survey results, highlighting that out of 67%
respondents who have a financial plan in place, 63% of them reported the
reason to have a financial plan is to manage expenses related to family
and children. Significantly higher proportion of metro residents cited
managing health related expenses, systematic investment, and leading a
luxurious/better life as triggers for active planning.
29%
28%
29%
43%
43%
44%
44%
45%
50%
51%
56%
63%
Help me to live independently without being dependent
On the children/ any other family members
For managing expenses related to family, children
To manage health related expenses in later stages of life
Friends/ family members motivate to plan actively
Investing small amounts systematically will grow our money
To lead luxurious life / better life
To monetize my hobbies and interests
Provide regular income once you are not actively earning
To build funds for later part of life when income
Might decrease because of leaving / retiring from job
To start my own business/ venture
To start a charity / help people in need /
be socially more responsible
To start my own business/ venture
Base 3009
74%
80%
70%
64%
79%
89%
Nuclear family (Living only
with spouse/children and not
with parents)
Nuclear family with Parents
(Living only with
spouse/children and parents)
Joint Family (Living with
spouse/children, parents and
siblings/other relatives)
2023 2020
Base 3009
21PGIM India Mutual Fund Retirement Readiness Survey 2023
Joint family units no longer foster a greater sense of financial security
– only 70% respondents reported feel financially secure staying in joint
families compared to 89% of respondents in 2020 retirement survey. On the
other hand, the percentage of respondents reporting they feel financially
secure staying in nuclear families did rise from 64% in 2020 retirement
survey to 74% now in 2023. Both of these measures did not change much by
age or income. Economic slowdown, fear of not being able to manage ones
own finances due to job/income loss and a good focus on self and fulfuliling
responsibilities for the immediate family, only including children and
parents” might have driven these results after pandemic. However, we need
to see if the trend remains same or change again over time.
Base:3009
Yes, I already
have a second
source of income
No, currently I don’t
have second source
of income, but I am
planning to start in
near future
No, I don’t have an
alternate source of
income and I have
never given a thought
to it
36% 39% 25%
44%
Income from
good/unique
skills
42%
Income in the
form of financial
investment
39%
Base:- 2251
23%
2020 2023
In order to fuel their aspirations post-retirement - and/or cover their
expenses - respondents are seeking various ways to add to their income.
Having a secondary income source makes Indians feel
less anxious
Having an alternate
source of income,
significantly
increases the sense
of preparedness for
retirement.
25% respondents don’t have a second source of income and have neither
thought about it. 36% of respondents reported to have an alternate source
of income, where 39% of Indians reported that they are planning to start it
in near future, highlighting the fact that Indians acknowledge this as to be
an important aspect of planning for now as well as future.
Out of 36% of respondents, who reported to have secondary source of
income, a significant percentage of respondents (on an average around
70%), also reported that they are prepared towards retirement, enjoy their
profession/work, feel financially free and secure and have a secured job.
22PGIM India Mutual Fund Retirement Readiness Survey 2023
More respondents
are now aware about
financial investment
providing returns on
their money, which can
in turn be a secondary
source of income to
manage their goals &
priorities.
Indians have been found generating secondary income from their
unique skills (44%). This number has improved since the last survey
(39%) in 2020. In addition to this, the second top most source cited by
respondents is income from their financial investments (42%), which
significantly increased from being 23% in 2020 survey, indicating that
more respondents are now aware that one can fetch good returns on their
investments and thus this can be turned into a secondary source to manage
ones goals & priorities.
Base:3009
Yes, I already
have a second
source of income
No, currently I don’t
have second source
of income, but I am
planning to start in
near future
No, I don’t have an
alternate source of
income and I have
never given a thought
to it
36% 39% 25%
44%
Income from
good/unique
skills
42%
Income in the
form of financial
investment
39%
Base:- 2251
23%
2020
2023
Are Indians a bit confused about how to efficiently plan
for retirement?
Majority of Indians have not vetted their retirement plan with a qualified
financial advisor: Amongst the 67% respondents reporting having a
retirement plan, more than 50% of them said that they have written down
their financial plan for retirement. However, out of that only 16% of them
said that a qualified financial advisor made this plan for them; suggesting
that most respondents, who claim to have a retirement or financial plan
haven’t vetted their plan with a qualified advisor and hence it is possible
that they haven’t considered all factors necessary for making a concrete
retirement plan.
Majority of Indians seek financial advice from their insurance agents: We
found that a majority of Indians who have a retirement plan in place have
been investing in FDs (63%) and insurance policies/annuities (57%) more
than other kinds of investments. The percentages are significantly higher
than from the ones who state that they do not have a plan in place. It could
mean that Indians might have been considering investing in insurance to
being financially secure and being prepared for retirement. Additionally,
a majority of those, who reported to have a retirement plan, have taken
financial advice from insurance advisors, and a lesser percentage quotes
taking advice from a registered financial advisor (10%). The preference for
seeking advice from insurance agents is majorly driven by 41-50 yrs., NCCS*
A and Females.
Very few reported to
have a written plan
generated by an
advisor.
*Please refer to the methodology on page 3 for the definition of NCCS.
23PGIM India Mutual Fund Retirement Readiness Survey 2023
Many respondents who have an investment plan are still not aware of
the retirement corpus they require once they stop working: 61% of
respondents reported that they are aware of the retirement corpus they
need once they stop working. However, 39% said they are not aware of it.
To note, with the increase in number of Indians planning for retirement,
the corpus amount that they believe is required when they retire has also
increased from 8-9 times of their annual income in 2020 to 10-12 times their
income in 2023. However, out of 39% who reported that they are not aware
of their retirement corpus, 54% of those respondents stated they have a
retirement plan in place, which seems strange—as if there is a plan in
place, one should know about the corpus required. This insight needs to
be explored further in the coming studies.
Around 2/3rd of
respondents who
reported to have taken
financial advice, take
advice from insurance
agents and only 10%
seek advice from a
registered financial
advisor.
Respondents feel that
they need 10-12 times
of their income as
corpus at the time of
retirement.
Awareness About Required Retirement Corpus
Yes, I am aware of the amount required once I stop working actively
No, I am not aware of the amount required, once I stop working actively
61%
39%
64% of these
saying they have a
retirement plan
54% of these
saying they have a
retirement plan
While Indians are acknowledging the importance of retirement and overall
financial planning, they seem to be quite scattered in their approach and
need proper planning. A qualified financial advisor can play a key role in
providing that guidance and support to understand ones finances fully and
help manage them efficiently. Additionally, employers can drive financial
awareness, motivate and further care for their employees to plan for their
finances well, especially retirement.
Type of Advisors Indians Seek Advice From
Registered Investment Advisor
Youtube Financial Influencer
Wealth Manager
Certified Financial Planner
Mutual Fund Distributor
Online Advice Providers
Independent Financial Advisor
Bank RMs
Insurance Agents
10%
13%
15%
15%
15%
21%
29%
48%
62%
Base: 608
24PGIM India Mutual Fund Retirement Readiness Survey 2023
Advisors & Employers As Key Drivers
of Financial Success
25PGIM India Mutual Fund Retirement Readiness Survey 2023
When it comes to selecting a financial advisor, the influence of friends and
family cannot be understated. Recommendations and personal experiences
of dealing with advisors often play a crucial role in the decision-making
process of shortlisting an advisor. In the current survey, 3/4th of respondents
get influenced by family/friends to approach an advisor. In addition, this
survey tried to find out where Indian investors take financial guidance from
and who influences the choice of selection, the qualities they look for in an
advisor, their expectations from advisor and more.
Of those surveyed, only 30% of respondents stated that they have
taken advice on financial planning. However, out of which around 62%
respondents have reported taking advice from insurance agents. In addition
to this, another significant finding is that percentage of respondents taking
financial advice has dropped to 30% from 56% in 2020 survey. This data
is majorly been driven by Tier 1 cities, NCCS* A males seeking financial
advice.
Friends & family influence the choice of a financial
advisor
30%
70%
Base:2011
Yes
No
Base:321
76
47
35
30
26
21
1 2
1 2
Friends/ Family members
Colleagues/ peers at workplace
TV ads/ TV articles
Internet / Social Media ads
Newspaper/ Magazines articles
Expert views on TV shows/ news
Radio ads
Blogs/ Vlogs
Type of advisor
Base:608
48
62
Insurance Agents
Bank RMs
Independent Financial advisors
Online Advice providers
Mutual Fund Distributor)
Certified Financial Planner
Wealth Managers
YouTube Financial Influencers
Registered Investment advisors
Driven by
41-50 yrs,
‘NCCS A,
Females
29
21
1 5
1 5
1 5
1 3
1 0
Around 3/4th of
respondents get
influenced by family
and friends to
approach a financial
advisor.
Have A Financial Advisor?
The choice of financial advisor is significantly influenced by family and
friends (76%), followed by peers at workplace (47%), TV adds/articles
(35%) and through social media (30%). When seeking advice, significant
percentage of respondents take financial advice from Insurance agents
(62%), followed by Bank Relationship Manager (48%), and Independent
Financial Advisors (29%), online advice providers (21%) and Mutual Fund
Distributors (15%). Further, only 10% mentioned they take financial advice
from Mutual Fund Distributors.
*Please refer to the methodology on page 3 for the definition of NCCS.
26PGIM India Mutual Fund Retirement Readiness Survey 2023
*Complete statements are “Good Professional (in terms of timeliness, grooming, knowledge and servicing)” and “Provide
Multiple financial services (provided for services such as mutual funds, shares/ stocks, tax filing, loans, health & life
insurance etc.)”
Indians want advisors to share their workload on
managing money
Aspects Valued In A Financial Advisor
What Indians seek in an advisor
Qualities Investors Look For In An Advisor
We found that getting better returns is the most important aspect that
investors value if they take advisory services, followed by reducing workload
of managing money. The percentage of respondents who want others to
manage their money to reduce their workload on managing money has
almost doubled to 54% in 2023 from 24% in 2020.
In the era of information overload, investors are looking for a skilled
advisor who can sift information from noise and provide them bespoke
solutions all under one roof. This is evident in the survey, where 3 in
4 respondents mentioned awareness of current market & knowledge of
various financial products are to be the top qualities they look for in a
financial advisor followed by being always accessible. Further, Indians are
looking for advisors who offer multiple products/services under one roof.
Percentage of
respondents valuing
advisors to reduce
their workload on
managing money has
doubled.
Better accessibility,
good qualification,
ability to service
online and provide
multiple financial
services reflect
expectation changes
after pandemic.
70%
50%
47%
49%
54%
69%
53%
55%
47%
24%
2023 2020
Gives better
returns on my
investment
Reduced risk
of losses
Helps me to
build a
balanced/
diversified
portfolio
Helps me to
guide on the
right financial
product
Reduces my
workload on
managing
money
Base: 608
Knowledge of
various financial
products
Awareness of
current market
situations and
future trends
Ability to listen
and understand
the requirements
clearly
Being
accessible at
all times
Assistance
provided for
online servicing
Qualification
and certification
Good
professional
Provide multiple
financial
services
2023 2020
Base: 608
67% 67%
56%
62%
43%
52%
34%
26%
77%
67%
61%
37%
28%
24%
0%
6%
27PGIM India Mutual Fund Retirement Readiness Survey 2023
Employers can be key drivers of financial success
among masses
Employers’ motivation towards financial planning increases employee
loyalty: More than just facilitating health benefits to employees, employers
have become more active in driving financial wellness among their
employees, which is reasonably valued among employees. Nearly 47% of
respondents mentioned their employer motivates them to plan for their
finances or retirement. However, these percentages significantly dropped to
almost half for public sector employees from 83% (in 2020 survey) to 48% (in
2023 survey). Even at the overall level, it reduced from 52% to 47% percent
in 2023 survey.
Financial stress and anxiety can impact employee productivity: The
findings of the current survey show that 32% respondents are anxious
about their finances, however majority said no. Amongst these 32% who
feel anxious, 75% feel that their anxiety has a direct impact on their
productivity.
2/3rd of respondents
reporting financial
anxiety, feel it affects
their productivity for at
least half of the day.
Financial Anxiety Among Employees
Base:- 954
Yes
No
68%
32%
Motivation/Support From Employer
2023 2020
Base: 1624
Often motivates Sometimes motivates Takes no effort to motivate
47%
52%
32%
34%
15%
14%
28PGIM India Mutual Fund Retirement Readiness Survey 2023
The research evidences that even those who claimed to enjoy their job
and feel secure in their current job said that their loyalty towards the
employer will increase. This indicates that employers can have an impact on
employees’ decision making with regards to retirement/financial planning.
Thus, organisations can be a great medium and game changers driving
financial awareness, inclusion and wellness among masses; reaping the
benefits of increased productivity, loyalty and reduced anxiety among their
employees in general, leading to business growth. Thus, this would be a
win-win and financially fulfilling for all - employees, employers and financial
industry as a whole.
1 in 2 respondents also
felt that their loyalty
towards their employer
would increase “if their
employer facilitated
their retirement/
financial planning.
Guidance From Employer
2023
2020
Base: 859
Yes, I will be somewhatIt would be great
motivated
I don’t want my current
employer to help
44%
56%
44%
11%
13%
32%
Guidance from employers can have a significant impact on employees’
retirement planning. As much as 88% of Indians said they would be
motivated (highly and somewhat) to plan for retirement if they get help and
guidance in retirement planning from their employers, with 44% saying it
would strongly motivate them. The figures here reduced from 56% in 2020
survey, indicating some interventions are required here.
29PGIM India Mutual Fund Retirement Readiness Survey 2023
CONCLUSION
Retirement is the only financial goal for which one cannot get a conventional
loan. One can always fill the gap through a loan if they fall short for any of
their financial goals like education, home, car or business. Thus, planning
for it from the day we start earning is way more essential than achieving
any other financial goal in our lives. We are glad to see that more and more
Indians are getting sensitized to plan for their retirement, however they
need some more handholding to be efficient in this process. We see that the
awareness to save for retirement is growing. Encouragingly, the latest survey
shows that 67% of respondents claim they have a retirement strategy in place
as compared to 49% in 2020 survey results.
The survey finds that more than 50% respondents have written down their
financial plan. However, out of that only 16% of them said that a qualified
financial advisor made this plan for them; suggesting that most respondents
who claim to have a retirement or financial plan have not vetted their plan
with a qualified advisor or believe that a combination of fixed deposits and
traditional insurance products is enough.
This clearly points to the need for more awareness around the approach to
protection, saving and investment and the role a qualified advisor could play
to facilitate an efficient financial plan incorporating both. What would help
further is to think of retirement more in terms of financial freedom from
ones primary source of income and continue working with what one enjoys
doing. This could provide a continuing source of income for as long as one
wishes and not only help in reducing anxiety related to building a corpus to
draw down from for expenses but also help build continued savings.
Next Steps
• The pandemic showed us the harsh reality of how savings/investments
could be depleted in absence of insurance (health and life) and an
emergency fund. The need to adequately cover your loved ones is the
cornerstone of building a sound financial plan, and the first step towards
this goal is to build an emergency fund which covers at least six months of
your expenses.
• Unlike gold or real estate, equity is the only investment type that captures
human progress in all fields and the potential to share the profits that
come from innovation all around. To save a nest egg for retirement, one
can start early in life—investing in equity mutual funds can help investors
build this corpus, in line with one’s risk appetite.
• Chasing higher returns or flavour of the season in the hope of getting
somewhere faster is a risky approach since higher returns come with
higher risks and is akin to betting. Increasing your savings rate while
working with relatively lower but consistent returns required for a specific
timeframe can get you to your goals with a much higher probability.
• Investing in your skills/passions can help you supplement your current
income as well as create a consistent stream of cash flows into your later
years.
• One can also choose to take a loan against mutual funds, without
redeeming ones’ investments and at the same time help the corpus
compound over time.
• Organisations can play an active role in helping employees plan for their
retirement by sensitising them on the ways and perks of building a stress-
free and fulfilling retired life.
• The role of a trusted financial advisor is paramount in helping investors
achieve their life goals by helping them in a disciplined manner through
budgeting, protection, savings and investment requirements.
