Writing about Life in the digital age

This is an interesting article based on the every debatable topic associated with the question of how much of one's income one should save. The ten per cent rule of thumb might not work in all situations. What matters is whether the country has a robust social security system, which unfortunately India does not have! Take for example,the question of Pension, a Government employee who decides to quit before the mandatory twenty years of minimum service will not get his gratuity or even his pension, that is even if he or she has served for more than fifteen years! In such a case, a ten per cent saving is too little. A person who doesn't have a pension fund might as well save most of his salary as savings for the rainy day! Inflation and devaluation of currency also means that the ten per cent of the salary that you save today will be peanuts by the time you retire from work. While it is true that one should save for the rainy day, it makes sense for responsible governments to provide for social security of its citizens, and the rationalize pension schemes for their employees. Pension rules in India are based on archaic laws stemming from the late eighteenth century Victorian rules, and it is these social security systems that need redress and review so that their is a sense of security in the employees even if they decide to quit before the discriminatory twenty years of mandatory service. In cases where their is no pension benefit, then a better option would be for people to invest in real estate rather than in public instruments like PPF, and Insurance. Unfortunately, returns on Life Insurance Pension schemes in India are so poor and hopeless that one must resort to them only in instances when one is looking for secure savings.