Financial planning is essential regardless of what stage in life you are in. If you plan well, you can set yourself up to take care of important events in your life with ease. Most people prefer investment options that allow them to focus on other aspects of life while simultaneously growing their money, like retirement plans.
A retirement plan is a term you’ll commonly hear about when discussing future savings plans for post-retirement expenses. Pension plans are also another common type of investment. Both plans provide a regular stream of income using the savings you’ve built up over time.
Retirement Investment Options in India
A comprehensive retirement plan can help you assuage any worries about your future. With rising living costs and inflation rates, more people are considering investment options to prepare themselves financially for future uncertainties.
Although there is no perfect time to start retirement planning, the sooner you start planning for your finances, the better it will be for you.
Types Of Retirement Investment Options
Here are some retirement planning options that will ensure a steady income stream after your retirement.
- National Pension Scheme
This retirement plan is administered under the Pension Fund Regulatory and Development Authority (PFRDA). This plan allows you to withdraw a portion of the amount as a lump sum and the remaining amount to be used as a regular monthly income. Furthermore, this plan also makes you eligible to opt for tax benefits under Section 80C of the Income Tax Act.
- Unit Linked Insurance Plan (ULIP)
This is a long-term investment option. This policy provides the benefit of investment and a life cover to protect you and your family financially. So the premium you pay towards this plan is divided into two parts. One part goes towards the life cover, and the other is invested into the fund of your choice.
- Public Provident Fund (PPF)
A PPF is another long-term investment option. The policy term for this scheme is 15 years and comes with competitive interest rates. You’ll be happy to note that the returns and interests gained under this plan are not taxable.
When you open a public provident fund account, the amount deposited during a year is claimed as deductions under Section 80C.
- The Senior Citizen Savings Scheme
A government-backed retirement plan. Anyone over the age of 60 is eligible to apply for this scheme. It offers the highest interest rates of all other saving schemes. Opting for this scheme grants you flexibility in the amount you want to invest in, great returns and tax benefits under section 80C.
- Pension Plans
Pension plans are specially designed with retirement in mind. These plans usually allow you to invest a part of your savings to grow over time, to provide you with a steady income in your retirement years. This plan provides a regular income after retirement and helps you handle any financial uncertainties post-retirement.
Alternatively, you can check and choose from suitable retirement plans available under the Tata AIA retirement plans. With such a policy, you can enhance your life insurance coverage and enjoy flexible premium options per your preference and needs.
Other Types Of Investment Options That Also Offer Steady Income After Retirement
If you already have retirement plans, you can also look into other avenues to secure your retirement years. Here are some other options such as:
- Immediate Annuity Plans
- Fixed Deposits of AAA-rated NBFC (non-banking finance companies)
- RBI Floating Rate Savings Bond
- Pradhan Mantri Vaya Vandana Yojana (PMVVY)
- Government of India bonds (GSECs)
There you have it! People opt for these popular investment options to prepare for retirement or meet other future financial goals. Regardless of your chosen plan, discussing all outcomes and possibilities regarding your retirement plan with your insurer is always important. Financial planning can be tricky, so cover all your bases before moving forward with your purchase.