Title: Declining joint family and emerging crisis in old age security

Authors: R. Vaidyanathan

Addresses: Finance and Control, Indian Institute of Management, Bangalore 560076, India

Abstract: The ageing India combined with a declining joint family system faces a crisis in social security for elderly. The government pension system has been converted from a defined benefit system to a Defined Contribution one. The mandatory schemes like Employees| Provident Funds Schemes cover a relatively small segment of the total work force. In all, more than 80% of the work force is not covered by any mandatory retirement/social security schemes. It is required for India to think of innovative products and systems to deal with the issues. Reverse mortgage on housing stock and converting huge stock of gold held by households by single premium pension products may help to some extent. But, it is equally important to stress on family values and savings based life style to face the long-term implications of the emerging crisis in the social security scene.

Keywords: defined benefit pensions; defined contribution pensions; employees provident fund; gold savings; pension products; household savings; joint family systems; reverse mortgage; social capital; voluntary schemes; social security; elderly; ageing population; India; mandatory retirement; family values; lifestyle.

DOI: 10.1504/IJICBM.2007.014476

International Journal of Indian Culture and Business Management, 2007 Vol.1 No.1/2, pp.151 - 173

Published online: 10 Jul 2007 *

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