Yet in today’s world of rising lifestyles, volatile markets and longer life spans, that question feels more intimidating than ever.
At the Mint Money Festival in Mumbai, Aarati Krishnan, head of advisory at PrimeInvestor, unpacked the numbers and the anxieties around retiring comfortably.
Why retirement feels more daunting today
For most people, retirement is not a distant milestone but a looming uncertainty. Krishnan pointed out that anxiety stems from four structural shifts.
First, pensions are no longer guaranteed. “Our parents often had government or secure jobs where the employer paid a pension. Today, most of us have to build our own retirement income,” she said. The safety net has disappeared, replaced by self-reliance.
Second, lifestyles have changed. Earlier generations were comfortable scaling down after retirement. Giving up conveniences such as house help, cabs or eating out did not feel like deprivation. Today, the expectation is continuity—maintaining the same standard of living for 25 or 30 years after stopping work.
Third, financial media and retirement calculators often circulate intimidating projections. “ ₹5 crore may not be enough, or ₹10 crore may fall short. For someone who hasn’t yet accumulated even one crore, projections of ₹20 crore or more feel paralysing,” she said.
Finally, there is confusion about execution—how to reach such large targets while managing present expenses. In an audience poll during the session, the dominant concern was simple: will I have enough?
The inflation shock and the 33x rule
Krishnan addressed one of the most common retirement yardsticks: accumulating 25 times annual expenses.
But she cautioned that many people misinterpret this rule. Based on research using Indian market returns and inflation assumptions, she suggested that a safer multiple in India is closer to 33 times annual expenses at retirement.
Also, the most critical mistake people make is applying the multiple to current expenses.
If a 30-year-old spends ₹1 lakh per month today and plans to retire at 60, assuming 6% annual inflation, that ₹1 lakh becomes ₹5.74 lakh per month at retirement. “The multiplication factor must apply to that inflated number, and not today’s spending,” she said.
The retirement corpus figure you arrive at may sound daunting. But Krishnan said that’s largely because people struggle to visualise compounding.
“Thirty years later, ₹20 crore may feel like what ₹2 crore feels like today,” she said.
She illustrated this with a simple example: a 25-year-old investing ₹20,000 per month in a SIP, increasing it by 5% annually, can potentially accumulate over ₹16 crore across decades. “People think they need rich parents or invest enormous amounts to accumulate such a corpus. But that’s not true, what they really need is time.”
Small adjustments in assumptions can also change the required corpus significantly. Lower inflation, slightly higher returns during working years, or disciplined step-ups in savings can materially reduce the target. “Retirement math has many moving parts,” she said.
Early exit dilemma
The discussion then turned to two modern concerns: job insecurity and the FIRE (Financial Independence, Retire Early) movement.
What if someone is forced out of a private-sector job at 45 but had planned to work till 60? In such cases, Krishnan advised stepping up savings early, minimizing loans and accepting higher equity exposure to aim for stronger returns. There are no shortcuts to take on such challenges; only preparation. Being mindful of the sector a person works in along with the level of job uncertainty it carries should also be taken into account.
On FIRE, she offered a nuanced view. Financial independence is achievable, she said, but early retirement in India is far harder. Unlike Western contexts, Indian households often support children well into adulthood and care for ageing parents. Social and family responsibilities limit the feasibility of fully stopping work at 40.
There are macro challenges too. India’s inflation assumption of 6% makes early retirement far more expensive than in countries budgeting for 2% inflation. And beyond the numbers lies identity. For many professionals, work defines who they are. Walking away early can create a psychological vacuum.
Krishnan believes the smarter goal is financial independence in terms of the freedom to scale down, consult or pursue meaningful work, rather than targeting zero income at 40 and live off the accumulated corpus.
Longevity risk
She also highlighted two common planning mistakes. The first is underestimating longevity. While India’s average life expectancy may be around 72, higher-income urban Indians often live into their 80s or 90s. Retirement plans must assume life till 90. Medical advances may extend lifespan, but they often increase healthcare costs too.
The second mistake is overestimating post-retirement returns. Some investors assume they can maintain 80% equity exposure and earn 15% annually even after retiring, thereby reducing the required corpus. But markets are volatile, and long-term returns may moderate if inflation and interest rates decline. Overconfidence can be dangerous.
For those already in their 50s and just beginning to think seriously about retirement, Krishnan’s advice was pragmatic. Gradually reduce portfolio risk. If holding illiquid assets like land or property, initiate sales early as real estate transactions in India can take time. Explore options like reverse mortgages if appropriate. Most importantly, consider extending work through consulting or part-time roles rather than assuming retirement at 60.
The session ended on a sobering yet empowering note. Retirement planning is not about chasing a frightening number; it is about understanding inflation, compounding and longevity and starting early enough for time to work in your favour.
