Money Matters

Plan your retirement: A well-thought-out pension scheme is an integral part of your security cover.

- Priya Desai

Financial security during the sunset years is imperative, and a pension has been considered the ideal way of ensuring it. Even today, many silvers who have served in government offices, public-sector undertakings, banks and even in the corporate sector enjoy the benefit of a pension. With increased longevity over the past few decades, the fiscal burden on the Government has mounted, forcing it to introduce changes to the pension system. A pension no more remains a rightful benefit after retirement but has been turned into a contributory facility for all those who joined government service after 2004.

The National Pension System (NPS) was born in 2009. Seven years later, it’s no more a toddler. Whether its baby steps have transitioned into giant strides is a question that eludes an easy answer.

Social security

With the silver population on the rise, social security is one of the prime concerns of governments in developed countries. It won’t be an exaggeration to say that social security in India falls in the private and family domain. It is also true that most people are ignorant of the need to build a social security net for themselves. An often-raised question relates to the timing of social security provisioning. Given the compounding power of money, it is ideal to start weaving a financial security nest at a younger age. However, it won’t be late for even the middle-aged and people nearing retirement to join pension plans. At the end of the day, it’s important to lend an assured basis to the income flow in the twilight years. Given the spectrum of choices available, it would be prudent to compare various pension plans.

An array of options