Retirement Planning 101 l The Best Retirement Plans in India

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Retirement Planning 101 l The Best Retirement Plans in India (Image: Shutterstock)
Retirement Planning 101 l The Best Retirement Plans in India (Image: Shutterstock)

New Delhi : In one’s career, retirement is a significant turning point. Planning for retirement cannot be put off since it involves making some critical decisions. Some people tend to put more money into their child’s schooling while putting off retirement planning. However, you can choose to take out loans to support your children’s college expenses, but you cannot expect to do the same for your retirement. Therefore, it’s important to start planning for your retirement today.

The first and most important step in retirement planning is to be aware of your future goals. The best retirement plan in India would therefore assist you in achieving your financial objectives. You need a sound plan of action to follow in order to achieve your goals. So let’s look at some of the best retirement plans in India to help you prepare for a stress-free retirement life.

1. Deferred Annuity

Deferred annuities are one of the best retirement plans in India that give the beneficiary the option of paying a single sum of money or regular premium payments to build up significant wealth for retirement. Once the tenure is over, the beneficiary of this retirement policy will begin receiving annuities. As a result, when the pension reaches its maturity, you start getting payments. Under this retirement plan, you may receive tax benefits. The assured amount, though, is locked. Simply put, while the plan is still in effect, the beneficiary cannot take funds from the accrued fund.

2. Immediate Annuity

Investors have the option to begin receiving payments right away with retirement plans like the immediate annuity. Investors have a wide range of alternatives to choose from with immediate annuities. The investor is required to make a single payment, after which they will begin to receive annuities. Under the best retirement plan in India, the nominee is entitled to the accrued fund in the event of the policyholder’s passing.

3. Annuity Certain

Under an annuity certain retirement plan, the beneficiary gets payments for a certain amount of time. The beneficiary can decide when to start receiving payments. It is vital to remember that the nominee is entitled to receive the remaining payments if the policyholder passes away before receiving all of the required payments for the due time.

You can calculate the premiums for your retirement plans using a PPF account calculator. A PPF account calculator helps in comparing and finding suitable plans depending on the individual’s needs. 

4. With Cover and Without Cover Retirement Plan

The best retirement plans in India, with and without insurance coverage, are very different from one another. A with-cover retirement plan transfers the assured value of the policy to the retirement plan’s nominee in the case of the policyholder’s unexpected death. On the other hand, with a without cover retirement plan, as the name implies, the nominee of the policy only receives the premiums paid toward the insurance and not any promised assured value in the event of the policyholder’s death.

5. Guaranteed Period Annuity

The best retirement plan in India that give guaranteed annuities for a set length of time is known as a guaranteed period annuity. This time frame is a multiple of five, such as ten, twenty, or twenty-five years. The nominee will continue to receive payouts even if the policyholder passes away during the policy’s term, which is another great feature of this retirement plan. The family of the policyholder is provided with financial assistance through this retirement plan.

6. Life Annuity

As the name suggests, a life annuity retirement plan provides the policyholder with payments or pensions throughout the rest of their life. Life annuity retirement plan entails an option of ‘with spouse’, wherein if the policyholder opts for it, their spouse will take over as the beneficiary of the annuities they receive under this retirement plan. Such retirement plans ensure your family’s safety while you are away.

7. National Pension Scheme:

The benefits of this retirement plan are available to working people in all industries, whether they are in the public, private, or unorganised sectors. It’s vital to remember that this plan doesn’t apply to persons who are employed by the armed services. With NPS, a person is free to make periodic contributions to their account while they are still working. The policyholder’s ability to withdraw from their accrued money up to a specific percentage is another excellent feature. The insured then receives the remaining portion of the fund in the form of pensions.

8. Unit-linked Pension Plans or ULIP Plan:

ULIPs, or unit-linked pension plans, are particularly advantageous since they permit withdrawals from the accrued fund. This retirement plan is also known as a whole life ULIP because it remains in effect all the way until the policyholder’s death. ULIPs provide both investment and insurance benefits. Under this retirement plan, policyholders can earn tax-free pensions while also saving on taxes.

Final Thoughts!

Retirement is a period of respite from the routine life you have gotten accustomed to for the majority of your adult life. Therefore, choosing the best retirement plan in India requires having a thorough understanding of one’s finances and aspirations.