India has steadily built a multi-layered social security framework aimed at improving retirement preparedness and financial protection across income groups. At the centre of this ecosystem is the National Pension System (NPS), a regulated, market-linked retirement product, complemented by targeted schemes such as the Atal Pension Yojana (APY) and Pradhan Mantri Shram Yogi Maan-Dhan (PM-SYM) for the unorganised workforce. More recently, the Unified Pension Scheme (UPS), effective April 2025, has been introduced to offer assured, inflation-linked benefits for central government employees.

Alongside pension initiatives, the government has expanded access to low-cost insurance through schemes such as Ayushman Bharat PM-JAY, Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), and Pradhan Mantri Suraksha Bima Yojana (PMSBY). Together, these programmes aim to provide a safety net covering healthcare, life, and accident risks.

Despite this extensive framework, adoption remains a concern. Personal finance educator Ankit Avasthi recently highlighted in a viral LinkedIn post that a large number of eligible Indians are yet to enrol in these schemes, even though many of them cost less than ₹500 annually. He noted that these offerings are among the cheapest globally but continue to see limited participation due to low awareness and inertia.

“These schemes are designed to enhance financial resilience, improve healthcare access, and provide income security in old age, yet many families are still not taking advantage of them,” Avasthi observed.

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Five key schemes every household should track

1. Ayushman Bharat PM-JAY
This flagship health insurance scheme provides up to ₹5 lakh per family per year for secondary and tertiary care hospitalisation. It offers cashless treatment at empanelled hospitals and is free for eligible beneficiaries identified through the SECC database. Notably, the scheme has now been expanded to include all senior citizens aged 70 and above, regardless of income.

2. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
PMJJBY offers a life insurance cover of ₹2 lakh at an annual premium of ₹436—effectively around ₹1.20 per day. It is available to individuals aged 18–50 years and requires an active bank account with auto-debit facility.

3. Pradhan Mantri Suraksha Bima Yojana (PMSBY)
This accident insurance scheme provides ₹2 lakh coverage for accidental death or full disability and ₹1 lakh for partial disability. With a premium of just ₹20 per year, it remains one of the most affordable risk covers globally. It is available to individuals aged 18–70 years.

4. Atal Pension Yojana (APY)
APY is designed primarily for workers in the unorganised sector, offering a guaranteed monthly pension ranging from ₹1,000 to ₹5,000 after the age of 60. Individuals between 18 and 40 years can enrol, with contributions determined by age and the desired pension amount.

5. Pradhan Mantri Shram Yogi Maan-Dhan (PM-SYM)
Targeted at unorganised workers earning below ₹15,000 per month, this scheme offers a monthly pension of ₹3,000 post-retirement. Contributions range from ₹55 to ₹200 per month, with the government matching the subscriber’s contribution.

Low cost, high impact

While insurance schemes like PMSBY and PMJJBY have fixed, highly affordable premiums, pension schemes such as APY and PM-SYM follow a contributory model where payouts depend on long-term participation. Even so, the entry cost remains low compared to private alternatives.

Experts note that the real challenge is not affordability but awareness and execution. Many individuals either delay enrolment or remain unaware of eligibility, missing out on compounding benefits and risk coverage.

Avasthi emphasised that enrolling in at least one of these schemes can significantly improve a household’s financial safety net. “The cost is negligible, but the long-term benefits—especially in terms of healthcare and retirement security—are substantial,” he said.

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Global pension systems

Pension systems differ widely across countries, but most follow a multi-layered structure combining state support, employer contributions, and individual savings. Understanding these differences is essential for globally mobile employees and organisations managing international workforces.

In Europe, countries like the UK and Germany operate pay-as-you-go state pension systems funded through employee and employer contributions. The UK also mandates workplace pensions, with a minimum combined contribution of 8% of salary. Germany follows a similar approach, with contributions currently at 18.6%. The Netherlands is often considered a global benchmark, offering a strong three-pillar system comprising state pension, occupational schemes, and private savings. Switzerland also combines compulsory state and occupational pensions to ensure broad retirement coverage.

In the United States, retirement income relies on Social Security, employer-sponsored plans, and personal investments. Defined contribution plans such as 401(k)s are common, placing investment responsibility on employees.

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Australia and New Zealand follow structured yet distinct models. Australia mandates employer contributions through its superannuation system, while New Zealand offers a universal state pension supported by the KiwiSaver scheme.