The 25x Rule to Retirement Planning in 2025 – And Why You Should Start Now

When we think of Independence Day, the vibrant parades of 15^th August instantly comes to mind—streets painted in saffron, white and green, flags fluttering proudly, and celebrations that fill us with a sense of unity. But beyond the parades, speeches, and tricolour in the sky, independence also invites a deeper, more personal question:

What does independence mean to you?

For some, it’s the freedom to travel wherever they want. For others, it’s breaking free from financial worries, or the ability to make choices without depending on anyone. It could mean living life on your own terms, with dignity, security, and peace of mind—especially as the years go by.

And that’s where a different kind of independence comes in. The kind that matters most when you’ve crossed 60. Because the truth is—retirement freedom isn’t gifted to us on a single day, it’s built over a lifetime, one wise decision at a time.

A decade ago, retirement would be seen as sitting on a rocking chair and reading the newspaper or knitting a sweater. Well, not anymore! Today, people are living longer, having a healthy lifestyle, and wanting to do more in their post-work years – travel, explore hobbies, maybe even start something new. It’s a second innings for them, but all of that requires something simple yet crucial: financial security.

We all agree that running out of money in our 70s or 80s is a real fear, and relying solely on children or pensions or stressing about medical bills might not be a good idea. What gives you true independence is knowing you have a financial plan that’s working for you, even when you are no longer working.

Here’s the solution for that secured independence – investing in a retirement-focused life insurance plan that offers regular income or putting money in long-term instruments that balance growth with safety.

Life insurance for retirement

With most people, the idea of planning for retirement does not go hand in hand with life insurance. At the same time, the right insurance policy is able to provide protection as well as an income stream during retirement.

Pension and annuity plans give you a predefined income once you stop working. In addition to life insurance, some retirement plans also provide tax benefits under Section 80C and 10(10D) of the tax regulation, with the option of commutation, which is a lump sum payment at retirement supplemented with a consistent payment stream thereafter.

While some people prefer ULIPs and other market-linked products that provide wealth accumulation, there is a segment of the population that prefers guaranteed income plans with income that can be depended upon. There’s no one solution tailored for everyone and it varies based on your age, life stage, risk appetite, etc., But in all cases, it is critical to begin as early as possible, and be disciplined.

Explore the life insurance options that best fit your needs – Click here
Older women in particular have to be proactive in planning for retirement. The combination of a longer life expectancy and more prevalent career breaks amplifies the need to have a personal financial buffer. After all, true independence, with no limitations, is never having to ask for money at any age.

Earlier the better, why?

It’s always better to start early so that your money gets time to grow. Here’s the thumb rule – the 25x rule. Your aim should be to save at least 25 times your annual expenses by the time you retire. If you think, you will require around ₹6 lakhs a year to live comfortably, your retirement corpus should be around ₹1.5 crores.

This is just a stepping stone. You also need to consider your lifestyle, your health conditions leading to medical costs, inflation, other financial responsibilities, and of course you need to keep an emergency fund for any contingencies.

Secure your tomorrow now!

This year, while we proudly celebrate the nation’s journey, maybe it’s a good time to also start thinking about your own. What does life look like in your 60s? What are some actionable steps you can take today to help you make that possible?

Because real freedom isn’t just about breaking chains. Sometimes, it’s about building a foundation – doing so quietly and with consistency, such that when the time comes, you will be ready to live fully and freely on your terms.

Our RNLIC financial experts are here to guide you throughout the journey. Reach out to us for a free consultation – click here.

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Mktg/RNLIC/blog_independence/V1/Aug25

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