While delivering the keynote address on Financing Retirement at Two days Seminar on Pension Reforms in India, Prof. Aman Agarwal, Offg. Director, Indian Institute of Finance stressed that India need to take care of the social security facilities existing in the economy. Indians strongly believe in savings and investment in the form of family’s future, their children to enable them serve as a social security for them in old age and provide for a socially secure future for them feels Prof. Agarwal.

Most of India’s citizens, over 55% population, do not have access to modern means of financing and evaluation techniques and are more conservative in nature. Only such PF schemes help them bread their support for socially secure late life said Prof. Agarwal. The PF and GPF schemes offering higher interest rates (as compared to market rates) need to maintain the rates, with which they were initially offered. Incase the government needs to adjust these with the market movements, then they should do it from current year of their implementation and not on deposits from retrospective effect opines Agarwal. He strongly says that it is not advisable that the government reduces the rates on the PF and GPF for now, given the small burden of only 300 crores on the exchequer against the cost of loss of confidence of masses and the Senior Citizen’s Dignity. It is important that the Senior Citizen of our country deserves to live with dignity, which they have rightly earned over their life span. The Government needs to see that the “Senior Citizen’s Dignity” is not brought to shame with any of its policy prescriptions reiterated Prof. Agarwal.

Speaking on financing retirement Prof. Agarwal said, whatever financial vehicles a person finally decides to put to work for himself, be should keep in mind that experts generally recommend a balanced and diversified investment portfolio. But it goes without saying that the greatest risk of all is not taking your retirement planning seriously. That's a risk that you simply can't afford to take.

Given the level of work and policies being made available for the people working in the structured economy, it is astounding to note that an estimated 400 million Indians workforce are not covered by any kind of formal social security system said Prof. Agarwal. Governments endeavor to maintain their means of financing social needs; need to be as stable as they have been in the past to ensure confidence and trust and Government should not be influenced by pure market driven economic systems for instruments which act as secondary basis for securing social late life of the masses opines Prof. Agarwal. He urged the Government to start various social security schemes such as Old Age Pension Fund, Post Office Retirement Scheme, Social Security Monthly deposit Account and also devise a stable policy of Pension fund rates.