Pros And Cons Of Extending Retirement Age In India

Consider the latest statistics 60% of the current working population in India will reach retirement by 2050. In effect, 44% of the Indian population in 2050 would comprise senior citizens up from the current 10%.

Economic Survey

Not only that, the Economic Survey makes a revelation that life expectancy for both Indian males and females is projected to go up meaning Indians will live longer. For the year 2016, the average life expectancy for a 60-year-old adult in India was 12.9 years.

When it comes to retirement, what are the current trends in India? Let us discuss that first.

Current trends in India

Given the higher life expectancy, government and private companies in India are mulling over increasing the retirement age from the current figure of 60 years. The few exceptions to this rule include teachers, court judges, and even CEOs of private banks, who can continue serving in office till 70.

The Economic Survey suggests that higher retirement age is essential for the sustainability of the current pension system. Add to that, 7 in every 10 working individuals in the country expect financial support from their children post their retirement.

Retirement:optimism vs Reality

All these trends do point towards a good case for increasing the retirement age. However, on the flip side, an increase in retirement age will interfere with the task of increasing employment – and filling up nearly 6 million positions annually over the next 2 decades.

Before the final decision, here is a look at both pros and cons of extending the retirement age.

Pros of extending retirement age

First, here are four pros of extending the retirement age in India:

  • Extended health insurance

    The longer your working age, the more are your health insurance benefits. Not only that, as health insurance premiums shoot up in older age, you will still have an income to pay for it. Late retirement also works in your favor – if your employee is currently paying for your health insurance.
  • More retirement savings

    With a rise in life expectancy, you also need your retirement savings to last for a longer period. For example, if you retire at 60 and live until 75 years, you need to plan your retirement savings for 15 years. Working longer allows you to add more to your retirement savings – or even save enough to plan a major vacation or a better lifestyle.
  • Skill development

    An extended retirement age also works better for employers – as they need to spend less on training and developing new recruits. This is relevant particularly for loyal and long-serving employees, who already have the skills to get the job done as required. Plus, these employees may also show better inclination in learning new job skills to extend their working capabilities.
  • Staying active could be good for your health.

    Yes, there are older people who are waiting to retire from their stressful jobs. However, research studies have concluded that work can do wonders for your physical and mental health, and can delay the onset of health complications and cognitive problems. Plus, older people who are socially more active are less likely to suffer from health problems.

Cons of extending retirement age

Next, here are three cons of extending the retirement age in India:

  • Impact of more work on your health.

    While there is ample evidence of late retirement being better for health, the opposite is also equally true. Timely retirement means saying goodbye to the daily office grind and work-related stress and welcoming healthy habits like long morning walks, ample sleep, or having leisurely meals.
  • Lesser opportunity to start something new.

    Extended working also means lesser time or opportunity to start something else. This could include a new career, hobby, or start traveling the world. For example, retiring at 60 gives you enough years to use your vast industry experience to work as a part-time consultant or start a business.
  • Lesser time for family or social opportunities

    Late retirement can also cut into valuable family time and give you lesser opportunities to spend time with your children or even grandchildren. Plus, if you are a socially active person, continued working can impact the time and energy you need to attend social events or functions.


As discussed in this article, there are multiple pros and cons to extending the retirement age in India. If you are considering early retirement, your decision is completely dependent on your current financial position as well as your physical health. You need to make the final decision after considering all these factors.

Resend OTP
OTP sent successfully on your mobile no
Please Enter OTP
Account belongs to
I agree to all Terms & Conditions
  1. Brokerage Flat ₹20 per order, Brokerage Flat ₹10 per order with Super Saver Pack
  2. Advanced Derivatives Tools on FnO 360 Platform to trade in Futures & Options
  3. 5paisa App and Web based platforms to Trade and Invest on your own