India has always been a promising country for the world and especially the young and aspiring ones. Its economy and geography make it like a diamond in the rough. But coming to India, what makes India even more popular is its heritage and culture that can never be ignored.
Thousands of people from countries across the world move to India every year just to carve out their names as businessmen as well as students. And as their second home, they also need a retirement plan for their old age as retirement planning is one of the most important aspects of life.
However, retirement planning remains ambiguous and confusing for both skilled and unskilled workers because of the little awareness. If you’re also going through the same struggle then make sure you read on to get your facts cleared.
What Is a Retirement Plan?
Retirement plans are designed to help you reap the fruits you have sown. You start saving money for your retirement from the day you buy a retirement plan. As you save, you continue to contribute money regularly.
When your income stops, the pay-outs you receive through these plans act as a replacement for your income in your golden days. While exploring retirement plans, you may come across certain technical terms.
How Do Retirement Plan Calculators Help You Choose the Right Plan?
1. Helps You Plan Your Finances
A simple to use retirement calculator will help you plan for your retirement years. It will help you to determine the amount of money that you need to save up so that you can live out your retirement years without worry and sustain your finances.
2. Free & Easy to Use
The retirement calculator has a simple interface and will only take 2-3 minutes to use. It doesn’t require any technical knowledge and it’s completely free. All you have to do is input the details and it will instantly show you the required information to make a good decision.
3. You Can Compare Your Options
Online calculators can help you determine the kind of retirement corpus different plans will offer you. Using it, you can choose the kind of retirement plan that best suits your financial needs for your retirement period when you no longer have a recurring income source.
4. Provides Financial Clarity
Retirement plan calculators can help you gain clarity on how much you will have to spend when you are retired. Once you input your relevant details, it will let you know what kind of monthly income you could enjoy in your golden years.
Best Pension Plans Available in India
1. Canara HSBC Oriental Bank of Commerce – Pension4Life
The Canara HSBC Oriental Bank of Commerce’s Pension4Life Policy is an annuity plan that allows you to purchase an annuity, then receive checks every month until you die. It’s one of the most versatile annuity products available in the Indian financial market.
Unlike other insurance policies, the purchase price of this policy is not affected by inflationary factors. Since capital guarantees play a role in the Pension4Life policy, the past performance of the underlying investments is not relevant.
2. LIC Jeevan Nidhi Plan
The LIC Jeevan Nidhi Plan is a pension plan with investment profits. The accumulated funds from your LIC Jeevan Nidhi policy are used to generate a pension for you based on how long you survive past your policy term.
Premiums paid during the first five years are tax-deductible. During this time, the policyholder will also get guaranteed additions of Rs.50 per thousand rupees of his/her endowment. The policy will participate in the profits of the company after the sixth year, at the terms determined by the company.
Moreover, the minimum basic Sum Assured is Rs 1 lakh under regular premium and Rs 1.50 lakhs under single premium policies. It is one of the best pension plans in the market.
3. SBI Life Saral Pension plan
A traditional pension plan is offered by a life insurance company, which offers investors protection from market fluctuations and volatility. This plan can help you achieve financial self-assurance, guaranteed bonuses for the first 5 years, @ 2.50% of the sum assured for the first 3 years and 2.75% of the sum assured for the following couple of years.
If you’re buying a policy, you have two options: a monthly instalment or a single one-time payment. The monthly instalment option has a minimum term of 10 years and a maximum of 40 years. Payments start at Rs 7,500 per year with no maximum limit applied.
The minimum age for this plan is 40 unless specified differently, and it has a maximum maturity of 70. The minimum sum assured is Rs 1 lakh without any maximum limit. You can pay the premiums in different modes – monthly, yearly, half-yearly.
4. HDFC Life – Click2Retire
The HDFC Life – Click 2 Retire plan is an online Unit Linked Plan that offers market-linked returns. This structure allows policyholders to meet post-retirement requirements with minimal charges involved in the process.
The plan provides guaranteed vesting benefits as well as additional gains from the market. The minimum entry age of 18 years is capped at 65 years of age, which means you can start investing in this retirement plan early on when you’re a young working professional.
It also allows you to lock in your maturity age at 45 years and the duration of the policy till 75 years. You can also take the benefits of tax exemption up to Rs. 1,50,000 if you invest in this retirement plan.
Final Words
For far too long, retirement planning has been a complex and difficult subject. There are so many different options to consider, and the costs can be hard to predict. Thankfully, there is now an easy way to find the perfect solution for your needs in just minutes. The retirement plan calculators take into account all of your details and then display the best pension plan for you based on your situation. It couldn’t be any simpler!