7 Benefits of Early Retirement Planning in India

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

Benefits of Early Retirement Planning in India

Benefits of Early Retirement Planning in India
  • 27th Aug 2021 |
  • 1,006

With 50% of India’s population below the age of 25, more and more young people are entering the workforce. However, the awareness regarding achieving financial freedom and retirement has not yet picked up.

Mentioned below are the reasons to start planning early for your retirement.

1. It is Easier to Start Early: If you are young, it is easier for you to start building a retirement fund. When you are young, you have lesser responsibilities and higher disposable income. As time passes, it is but natural to shoulder responsibilities that may reduce your ability to save for retirement.

2. Take Advantage of Power of Compounding: “Compound interest is the eighth wonder of the world,” as quoted by Albert Einstein. Compound interest simply means earning interest on interest. Just invest your money and stay invested for a long term to understand the magic of compounding. The easiest way to do this is to start early and invest regularly. By the time of retirement, compounding may work wonders in building your retirement corpus.

3. Avail Tax Exemption: Investment in most of the investments and pension plans are eligible to avail tax exemption under section 80C. Thus, you can save income tax deductions while planning your retirement.

4. Ability to Face Emergencies: One of the many beauties of life is that it can throw surprises. Some of them might not be memorable. However, if you start planning early, you can be ready to face any emergency. You will have time to save for an emergency fund to fall back.

5. Higher Flexibility: Whether you plan to purchase a ULIP, a non-participating retirement plan or both, you can have higher flexibility to choose if a considerable amount of working life is left with you. Moreover, you can have an idea of the amount you may get from the commencement of the pension plan benefit date.

6. Rising Inflation: India has witnessed a steady rise in inflation for the last two decades. In 2020, it was 6.2%. This means that the value of Rs.100 earned in the financial year 2019-20 stands at Rs.94 in the financial year 2020-21. As a result, investing in a retirement corpus becomes difficult with growing age. The cost of saving can keep increasing with each passing year. The earlier you plan, the more can your chances of achieving your target.

7. A Better Option than FDs: The average rate of a bank fixed deposit up to 5 years was 7% in the financial year 2010-11. Ten years later, at present, it hovers around 5.3%. If you choose to keep your money in a bank fixed deposit amount, your earnings from interest may keep decreasing. While deposits are a great saving tool, they may not be a great way to build your retirement corpus. A retirement plan will help you build a corpus that can beat inflation.

When you start investing in a retirement plan from an early age, it gives you more time to build the corpus you would need in your retirement years. Moreover, you can grow your investments as you grow in your career.

Kotak e-Invest

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Download Brochure


  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521


Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Importance of Retirement Planning

Long Term Investment Guide for Your Retirement

ULIP Tax Benefits: यहां निवेश करने पर मिलते हैं 5 बड़े फायदे

Top 4 Myths About ULIP Investments You Should Know

What is Partial Withdrawal in ULIPs?

What Are Mortality Charges In ULIP?

Why Are ULIPs Called Flexible Investments?

Ten Signs That You're Ready to Retire

Know Why You Should Stay Invested in Your ULIP Plan

Meaning of Sum Assured in a ULIP

Tips to invest your voluntary retirement scheme money

5 Common ULIP Myths That You Should Stop Believing

How Does NPS Work?

What are the Benefits of ULIP - Explained

Which are the Best ULIP Plans in India for Children?

What is the Difference Between EPF, VPF, and PPF? What are Their Tax Benefits?

Why Should I Invest in ULIP?

How To Make Most of Your Money After Retirement?

Which Is Better: ULIP or SIP?

Why Should Retirement Planning Be on Top of Your Priority List?

Is it Suggestible to Take a ULIP Plan Linked with a Term Plan?

What is Premium Redirection in ULIPs Plans | ULIP Insurance Plans | Kotak Life Insurance

ELSS vs ULIP: Which is a Better Investment?

Is ULIP A Good Investment Option?

Getting Close to Retirement? Six Key Retirement Planning Tips That Can Help You Retire

5 Reasons Why ULIP Plans are One of The Best Retirement Planning Instruments

Why Should You start Retirement Planning as soon as you start a job?

How Is ULIP Different from Other Life Insurance Plans? Where Can I Invest - ELSS, ULIP, or PPF?

Types of Annuity Plan | Annuity Definition - Meaning & Key Benefits | Kotak Life

Here's What Retirement Would Look Like 30 Years From Now

How Quickly is Fund Switch Effected in ULIPs? Is it Done the Same Day or After a Particular Number of Days?

Do ULIPs Give Good Returns On Investments?

How is ULIP NAV calculated? How is the return calculated in ULIP?

How to Choose the Best ULIP Plans to Invest in 2022?

How can NPS help you save tax?

Benefits Of Retirement & How Investments Can Help You Enjoy Them

A Quick Guide to Retirement Plans

FAQs on Taxation of ULIPs

What are the Charges Levied on ULIP?

What is the Minimum Lock-in Period for ULIP?

What is NAV in ULIP, and How is it calculated?

Single Premium ULIP or a PPF - Which One is Better?

Top 4 Mistakes To Avoid While Planning For Your Retirement

Benefits of Early Retirement Plans

Why You Should Invest In An Annuity Plan?

What are the Rules for Exit From NPS?

What tax benefits are there on saving for retirement?

What is an Annuity Plan and How Does Annuity Plan Works | Kotak Life

10 Steps to Figure Out How Much Money You Will Need After You Retire

What is Lock-In Period in ULIPs?

5 Retirement Planning Tips for a Financially Controlled Post-Employment Life

यूलिप के फायदे (Benefits of ULIP in Hindi)

What are the things to consider before buying ULIPs?

How Can ULIPs Help You Plan for Your Child's Future?

Is ULIP Better Than FD?

Top 6 Reasons Why You Should Get A Pension Plan

Retirement and Pension Plans in India- What are Your Options?

What are ULIPs and their Types?

Managing Your Retirement Income with an insured retirement plan

What is ULIP and Its Benefits?

Calculating a Retirement Corpus that can Support Your Lifestyle

Pros and Cons of Retirement Annuities

How has ULIP Grown Over the Last 3 years?

Difference Between Unit-Linked Insurance Plans and Non-Linked Plans

Does Having Both ULIP Plan and Other Health Insurance Plan Make Sense?

NPS for Housewife

Retirement Planning - How To Calculate Your Retirement Premium in India?

How To Choose The Right Pension Plan?

What are the Uses of ULIP?

What are the minimum and maximum investment in ULIP? Would the Whole Amount Insured in The ULIP Insurance be Invested in the Market?

Un-Retirement - Are You Ready For It?

Are Annuities Great For Early Retirement?

Retirement Planning Guide: These 5 Steps Will Help You Towards a Safe, Secure and Fun Retirement

How to Win at Retirement Savings?

Types of Pension Plans for Your Retirement

5 Steps to Gift a Smart Retirement Plan to Your Parents

Is It Worth Buying ULIP Plans For 10 Years?

What Are Retirement Pension Plans?

Worried About Running Out of Money in Retirement? 4 Tips to Avoid This Crisis

What Happens If I Stop Paying My ULIP Policy Premium After Paying the First Premium? Will I Still Get The Return?

Retirement Planning at 50? You Are Still Good to Go

6 Signs That You Are Not Financially Ready For An Early Retirement

How To Calculate The Present Value And Future Value Of Annuities?

What is the difference between Life Insurance and ULIP?

5 Reasons to Buy ULIP for a Secured Financial Future

Who Gets the Benefit After the Maturity of ULIP: The Proposer or The Life Insured?

How to Build a Tax-Free Pension Income for Retirement?

The Significance of Number 8,000 in Retirement Planning

Why are ULIPs One of the Best Tax Saving Instruments?

Terminologies You Should Understand About Retirement Plans

How should one decide on fund allocation within NPS?

How Does Pension Plans in India Works?

Is the ULIP Policy Surrender Value Taxable?

Looking for Ways to Earn Lifetime Income in Retirement? Here Are 6 of the Top Options

How Do Annuity Options Work In NPS

What are the 4 Financial Phases of Retirement? How to Budget For Each One?

Different Types of Retirement Schemes

Top Investment Options for Retirement Planning

What is the Estimated Return Percentage on ULIP? Do Investors Get Compound Interest?

ULIP: Can You Surrender ULIPs or Withdraw Money from It?

What are the Instruments Available for Building a Retirement Corpus?

What is a Retirement Plan - What are its Features?

Is ULIP a Complex Financial Product?

Do Pension Plans Allow any Death Benefits?

8 Charges in ULIP That You Must Know

Retirement: A New Start to Life!

What are the Chances of Losing all my Money in ULIP and How Much Return Should I Expect?

Understanding Annuity Plans

Give Your Retirement Savings A Booster-Shot with Annuities

Retirement Planning for Millennials

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

Top 6 Flexible Benefits That ULIPs Offer

How To Invest Money In ULIP?

What Are Superannuation Benefits?

What is Fund Value in ULIP?

Advantages of Pension Schemes and Retirement Plans

Can NRIs Invest in ULIP Plans Offered in India?

Why ULIP Should Be a Part of Your Investment Portfolio?

Can I Surrender My ULIP Policy after 2 Years?

What To Do With Your Retirement Accounts During An Employment Lapse?

यूलिप के 8 शुल्क

Retirement planning with a systematic life insurance plan

Why Should You Invest in NPS?

ULIP Plan or Traditional Insurance Plans - Which is better?

5 Notable Investment Options for Retirees

How Safe is it to Invest in ULIP plans?

Invest for your second innings with a guaranteed savings plan

Retirement Planning Guide for Working Men and Women

Different Types of ULIP Investments in India

A Beginner's Guide to Understanding 401k Retirement Plan

Which Pension Plan Suits You best?

How Can I Achieve My Wealth Goal with ULIP Investment?

Inflation: A Key Factor to Consider into Retirement Planning

What is the Death Claim Payable in the Case of ULIP?

How Has NPS Performed in Comparison with Other Instruments?

At What Age Should You Start Your Retirement Planning?

Is ULIP a Good Option for People Above 60?

How Does ULIP Work in India?

Is it Advisable to Withdraw the ULIP Insurance Policy After 5 Years?

Save Early to Keep Living Your Dreams Post Retirement

How To Keep Your Retirement Accounts from Being Hacked?

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

Are You Planning an Early Retirement? Here's Why Buying Annuity Plan Will Make Sense

Best Insurance Plans for a Guaranteed Monthly Income After Retirement!

Demystifying the Retirement Planning Process

7 Secrets that can Make Your Post-Retirement Phase Prosperous

ULIPs or Pension Plans – Which is a Better Retirement Plan?

Saving for approaching retirement with retirement insurance

10 Steps to Figure Out How Much Money You Will Need For Your Post Retirement Plans

Types of Retirement Plans

Importance of financial Planning for Retirement

What are the Differences Between ELSS ULIP and Mutual Funds?

Annuity Plan | How to Choose the Right Annuity Plan | Kotak Life

How Much Corpus Does One Need for Retirement?

What are the Advantages and Disadvantages of ULIP?

What Happens to ULIP Premiums Paid if the Market Crashes?