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Demographic Factors and Saving Behaviour: It’s Relevance in Financial Planning for Retirement


Life expectancy, in India, was 41 years in 1960, which stands 69.4 years in the year 2018, (World Bank, 2020). This improvement in the life expectancy is due to enhanced standard of living and improved healthcare system in India.

India is a young nation with 28.34 years as a median age and more than 60 per cent of the population is in the working age group. Favourable saving and investment practices followed by this young population would lead to personal wealth creation and there would not be financial strain after retirement. RBI report on household finance revealed that 77 per cent of the population did not save for retirement. It is important to understand the saving and investment practices followed by this young population. The saving and investment practices are influenced by many demographic variables (May & Sterne, 2018). Demographic variables such as age, gender, income, education, family size to name a few, influence the earning capability, amount available for saving, understanding of various financial products available for investment and making financial plan for life after retirement. The present study has probed into relevance of demographic factors in financial planning for retirement. The study has considered predictor variables, namely age, gender, education, profession, size of the family, total earning members in the family, frequency of saving and advice for saving. The study is conducted in the Quilon City, Kerala. For the study primary data is collected using structured questionnaire. Google form was the medium to collect the data. Binary logistic regression is used to analyse influence of afore mentioned variables on individual’s act to take decision to make financial plan for retirement. The study revealed that age, profession, number of earning members in the family, frequency of saving and advice for saving has significant impact on individual’s initiative to plan for retirement.

Keywords: Financial Plan, Demography, Retirement