NEW DELHI: Surendra Arora, a 34 year old software engineer, had everything planned: his children’s education, investment and even his retirement. At least until March 2020. Once the Covid-19 pandemic broke out in full force and the economy tanked, much of his saving were lost in expenses for the treatment of his elderly parents. This was only made worse due to his wife losing her job a steep salary cut effected by his own employers.
Eight months down the line, he says he has finally got his salary reinstated to its original level, but his wife is still struggling to secure a job and he has shifted his pre-Covid goal post of retiring at 45. “It was a major financial crisis for me.
Things are slightly better now but I need to save more and work more to be able to retire peacefully like I had planned. I do not see it happening at 45 considering the current situation,” Arora laments. He is not alone.
Post-Covid financial shocks and uncertainty about the future has forced many people to rethink their retirement plans and renegotiate their goals to reflect the new financial realities.
“I had lost my Job in April. I had an option to withdraw some amount from my PF. It helped me to sail through the first three months. I have got another job but the salary level is not the same as earlier. Right now, I am thinking about how I can secure extra income... my retirement plans have been hit,” said Saurabh Sharma, an executive at an export house.
Financial planners warn that the pandemic has had dramatic implications for retirement goals, and that people are reviewing their options and earning power in a world which seems highly uncertain—with a volatile job market, indiscriminate layoffs, and massive salary cuts. “We have a significant dip in people opting for new SIPs.
People are wary of investing in instruments which have lock-in clause. Even those who have their jobs intact, are feeling insecure and this forced them to save in safe instruments.
Even those who can afford are holding on their money tightly, “ Neeraj Grover, a personal Finance advisor based in Mumbai said. However, this trend is mostly visible in the middle class. More well off clients are investing in Gold and real estate. “One invested in two stressed properties for cheap. He feels this will be better retirement investment than putting it in any fund or other assets”.