Retirement in India


Why retire in India?

When I retire I’m going to spend my evenings by the fireplace going through those boxes. There are things in there that ought to be burned. – Richard M. Nixon

Retirement planning is critical for everybody but people of Indian origin always debate on whether to go back or stay back abroad. Either way, planning is very critical and there are calculators and planners available.
Here are the reasons why retiring in India is worth considering:

  • Cost of living Calculator – Bangalore: Taking a hypothetical situation with $100k annual income living in Phoenix have a cost of living of $3,500 per month. Using the Cost of living calculator we see that the same type of lifestyle costs $1,500 per month
  • CNN Calculator:  Total retirement amount required in US is around $4.4 million (adjusted for inflation) for a 30 year old contributing 5% of the income to the 401k.
  • Indian retirement: Total retirement amount required in India is around $2.2 million (adjusted for inflation) for a 30 year old with the cost of living comparable to US standards.
  • Social Security: American Citizens who retire abroad after 62 are eligible for social security benefits subject to the condition that you have worked for a minimum of 10 years or earned at least 40 credits under Social Security system. Verify your situation in the site. No change in taxation of the income.
  • Medicare: Since the residency of US is mandatory for Medicare eligibility individuals may not be covered. Check your situation and the rules may change in the future.
  • Buying and renting a property can favorably contribute to the retirement income or residence.
  • The benefit of living with your old friends and family is priceless.
  • Nearly all the restaurants and food chains have their presence in India
  • Luxury cars could be purchased
  • More opportunities for volunteering and making a difference to the community
  • Having an accountant will help to navigate the tax situation in both countries
  • Essentially similar lifestyle could be pursued at lower cost
  • Sooner you decide your retirement destination, it will be easier to plan and schedule your funds or investments.
  • The above are based on certain assumptions and your situation may be different. I would encourage you to do your homework and let me know if there are any questions.

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