AWARENESS, GUIDANCE KEY TO RETIREMENT PLANNING : V. VAIDYANATHAN

DFC First Bank has seen remarkable success in 2023, riding on impressive financial performance, with deposits growing at 40% thanks to customer-friendly banking initiatives and tools. In an exclusive interview, V. Vaidyanathan, managing director and chief executive officer of IDFC First Bank, speaks about the importance of retirement planning early in life, the emotions of those concerned and the tools for retirement planning which can provide financial security and peace of mind

 

 

Considering the rising life expectancy and the need for a larger corpus post-retirement, what are your broad thoughts on this matter?

Firstly, I appreciate Outlook for initiating this 40After40 Retirement Expo series. It is very timely, especially considering the increasing life expectancy. The average life span, once around 50 or 60 [years], has now reached 70 and is projected to rise to 74 by 2030 and 78 by 2040, which is not distant at all, just 16 years away. This underscores the significance of your question. If [retirement is] not planned, people can find themselves in a difficult spot.

We are witnessing rapid societal transformations in India and globally moving from traditional large families to nuclear setups and evolving family dynamics. How does this shifting landscape impact retirement planning strategies?

Because of shifts in technology and change in economic conditions, life can be uncertain for the next generation themselves. So, we never know, the next generation may have their own financial and life issues to deal with. Or with increasing global mobility, the next generation, despite best intentions, may not be able to be physically present to help. Also, culture may change over time. This can leave many individuals more financially and mentally vulnerable in their retirement years.

So, how hard can it get?

When I consider the elderly individuals we encounter daily, including our own parents, you can see for yourselves. Compared to their prime years, now they feel lonely; they sometimes feel they are not relevant in the family due to their health issues. Imagine, to add to this, if they have financial issues. To save early and to invest in retirement plans can help [reduce] stress and give security 
in old age.