Analysis of Retirement Segment

SBI Life – Retire Smart Plus

Product Management
 What is Life Expectancy?

It refers to an estimate of the average age that

members of a particular population group will
be when they die.

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 Life Expectancy of Human Being
Life Expectancy
400

80.3
350
77.6

300
66.4 76.9
71.7
250

60.3
200 75.9
50 70.5

59.3
150
36 77
72.2
100 33 37 64.5

31 45.2
50 62.9 69.7
29.9 49.1
32.6
23.1
0
1911 1941 1971 2001 2019
India Sri Lanka Brazil China Costa Rica
www.ourworldindia.org/life-expectancy
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 Life Expectancy of Human Being
Life Expectancy
82

80

78

76

74

72 80.75

77.39 77.3
70 76.37

68
70.19
66

64
India Sri Lanka Brazil China Costa Rica
2022

www.news18.com/news/opinion/indias-life-expectancy-is-improving-but-mind-the-gap-between-different-groups-5070685.html
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 Reasons for increase in life expectancy

Advancement in Better Increase in

Enhancement Flexible
Healthcare/Smar Quality
ter Health standard of accessibility Working/Transpo
Education
in technology rt
Tracking living to resource

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Impact

Increase in average life span

Earning age for avg life is till 60 years.

On Retirement Year our Regular source of income

stops

Managing day to day expense will be Financially

Straining

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 Age – wise Population of India in 2022
Age Group Population Percentage

0-14 years 356,733,454 25.36%

15-24 years 250,203,116 17.78%

25-34 years 232,900,683 16.55%

35-44 years 201,729,266 14.34%

45-54 years 154,403,711 10.97%

55-64 years 112,571,062 8.00%

65 years and over 98,090,489 6.97%

https://www.theglobalstatistics.com/india-population-statistics/
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 At Present …..

As India is Provident Fund

By 2050, 324
getting aged, and gratuity Half of India isn’t
million Indians
over 61% of only takes care prepared
or 20 % of Financially for
elderly will have of 30% of your
population will
low income total post
be above 60
security by retirement corpus life after work .
years of age requirements.
2050.

www.Financialexpress.com/economy/as-india-ages-over-61-of-elderly-will-have-no-income-security-by-2050/71511/
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 What are the main worries of retirement?

While retirement comes at the bottom of financial concerns

in terms of priority, there are people who do think about it
and how their life will look like once they retire

Indians worry about maintaining their living

standard

Worry about medical expenses

Worry about lack of future financial support

Not retirement planning but children’s needs, family’s financial security top priorities for Indians: Survey | The Financial Express
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Worries Related to Managing Finances Post Retirement.

Cost of living/ Inflation

Health of self/spouse/parents/Accidental
Disability/Critical or Terminal Illness

Nuclear family structure.

Living for longer than the money

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 Inflation Factor That Affect Cost of Living

Medicine
Higher Food Cost Higher Utility cost
By 25%
By 8.35% By 13.15%

Higher Oil & gas

Dinning Out by 12%
price by 17.48%

From News Paper article

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 Medical Expenses

Procedure Old Treatment New Treatment

Arthritis: Joint/knee Cemented/Uncemented Coral synthetic implant

replacement implant cost Rs 50,000- (ceramic/oxinium) cost aprox
60,000 rs 1.2 lakh

Avg cost of India – made Imported Implants

Spinal cord surgeries stainless steel implants around (German/Korean) cost around
Rs 30,000 Rs. 60,000

Implant using mechanical Average cost of Implants

Heart Stroke valves cost Rs 60,000 on an using tissue heart values is Rs
average. 1 lakh

Metallic version cost around New biodegradable stents

Coronary stents Rs. 40,000, drug eluting ones cost more than Rs 3 lakh
Rs 1.5 lakh

The Times of India News article

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 Awareness of Amount Required after Retirement

How much percentage

population of India are
aware, that after
retirement what
Amount is required?

Yes 52% No 48%

How Much percentage 34%

66% 31% 69%
of population has
Retirement Plan?
Yes No Yes No
Total % People has Retirement Total % People do not have
Planning Yes 49.2%
Retirement Planning No 50.8%

(https://www.financialexpress.com/money/not-retirement)
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 Case Study
Mr. Ajay 40 years old, IT professional and earning
Rs. 5 lakhs p.m By Looking the current
scenario of the society
in India.
Mr. Ajay wants at least Rs. 6.cr of corpus after his Mr. Ajay is very worried
retirement, so he is looking for some investment . about his life after
Retirement.

Current Monthly Expense Monthly Expenses after 20 years

Rs- 75,000/- Rs- 3,02,905/-
Time Horizan 20 years
Investment Duration 20 years
Investment Amount Rs-16,00,000/- p.a

Mr. Ajay is worrying about his future?

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 Retire Smart plus MF/ Stocks/NPS PPF/EPF
Total Investment
= 3.20 cr Investing – 1.40cr Investing – 1.40cr Investing – 40 Lakh

Yearly AMT
Investing
7.0L 7.0L 2.0 L

FV- @8%(Rs.) 3.27 cr 2.85 cr 88 L

@ age of 60.

After age 60
Yearly Annuity
21.47L This amt he will get as an lump sum

Contribution % 54.50% 47.5% 14.66%

SBI Life - Retire Smart Plus UIN (111L135V01)

Mr. Ajay has also invested in different Asset Classes.
Out of 36 Lacs Annual Expenses required after 20 years 20 Lacs meet through Life Insurance Annuity Plan and balance through other investments

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