Doesn’t matter when you were born, your parents would have advised you to aim for a government job. The charm of government jobs in India stems from the stability it offers while working and even after retirement. Though the pension scheme for government employees was tweaked in 2004, they are still better off than employees in the private sector.

The government contributes an amount equivalent to 14 percent of a government employee’s salary to the pension account, but private sector workers receive no such benefits. Besides government-sponsored pension programs like the National Pension Scheme, private sector employees have to proactively plan for their retirement. Retirement planning should revolve around ensuring a regular income with all the savings and assets created while working.

Here is how to plan for a stress-free retirement.

Health Insurance

With rising life expectancy rate in India, people are spending 15-20 years in retirement as compared to 10-15 years earlier. A longer life has led to an increase in health issues and unexpected expenses. The best of plans can unravel under the pressure of expensive hospitalization. The first step towards a secure post-retirement life is to get a suitable health insurance coverage. In the absence of a life cover, substantial resources will have to be kept aside for medical emergencies.Future Generali Heart and Health Insurance Plan provides the following benefits:

  • A comprehensive cover against 59 critical illnesses and surgical procedures including heart and cancer related diseases.
  • The plan is also entirely flexible and can be customized as per your needs and family history.
  • The plan has in-built death benefit available from the first day, without any waiting period
  • Under the plan you also get a fixed lump sum payout on the diagnosis of critical illness or undergoing surgical procedure covered under the plan.

Guaranteed Plans

Investing in guaranteed savings plans is one of the most crucial decisions of your working life. Here’s why:

Amit is a 40 year old, non-smoking male. He decides to invest in Future Generali New Assured Wealth Plan - Option 2.

  • His policy term is 20 years.
  • He pays a monthly premium Rs. 9,227* for 10 years.
  • His sum assured will be Rs. 10, 00,000.
  • He gets a guaranteed addition of Rs. 83,100 from 8th policy year till the end of the policy term.
  • At the end of the policy term he receives maturity pay-out of Rs. 20, 80,300.
  • In case of death of life insured during 1 to 9th policy year, the death benefit given to the nominee will be Rs.10, 59,000.
  • In case of death of life insured during 10 to 20th policy year, the death benefit given to the nominee will be Rs.11, 12,580.

This means when Amit turns 60 years he receives a lump sum pay-out of Rs. 20, 80,300. He can use this amount as his retirement corpus or further invest in annuity plans. There are many other guaranteed plan options one can choose to invest in. To know more, click here.

One must understand, it can be difficult to choose a retirement plan and even more difficult to stick to it. But if you want to achieve the desired goal, you must stick to the plan you bought. Do not discontinue the plan before it has matured. Watch it grow so that you can eventually retire with the money you need.

Employee Pension Scheme

A social security scheme for employees in the organised sector, EPS ensures pension after the age of 58 years. The employee pension scheme runs parallel to the employee provident fund. A private sector employee has to deposit 12 percent of the basic salary and dearness allowance to the employee provident fund. Employers match the contribution, but 8.33 percent from the employers’ contribution goes into the employee pension scheme. To avail the benefits under the scheme one has to complete at least 10 years of service. EPF is a fairly simple scheme as the Employee Provident Fund Organisation predominantly invests in debt securities, which guarantees assured returns in the form of annual interest. EPFO has started taking exposure to equities, limited to 15 per cent of the corpus.

National Pension Scheme

The national pension scheme is a voluntary government-backed contribution scheme open to all, but compulsory for government employees. Private sector employees can use the scheme in consonance with the employee pension scheme. While EPS gives assured returns, NPS is a market-linked scheme with the probability of higher returns in the long run. Subscribers in the scheme can choose the proportion of allocation to different asset classes like equity, corporate debt, government securities and alternative assets. Investors have an option to have an equity exposure of up to 75 percent until the age of 50. Though returns may fluctuate in the short term, the flexibility to have a high equity exposure allows NPS investors to accumulate a large corpus over a long time.


To conclude, retirement planning is a very important step. To take an informed decision when it comes to retirement plans, connect with our financial advisor, click here.


*Annualized Premium excludes underwriting extra premium, frequency loadings on premiums, the premiums paid towards the riders, if any, and Goods and Service Tax.