Get Wings to Your Financial Freedom Through Pension Plans

At the time of Retirement best gift, we can give ourselves is good Pension Plan. Though nowadays there’s no age of retirement as its more of personal choice. However, official retirement age varies between 62 to 67 years. People also take voluntary retirement at the age of 50 years or even early. We may choose our retirement as per our choice and interest.It may be as early as possible or later threshold of our life.However, The major factor that may delay our retirement is financial constraint. But with proper planning, we may choose to retire anytime.

This can be possible by taking good Pension plan as per our requirements. This has got many other benefits as well that has been explained in details below.

Why do we need pension plans after Retirement?

1. Financial Freedom:- Biggest Advantage of having compare & buy pension plan is guaranteed source of Income and required capital after retirement. Even if we have a pool of funds, Pension policy is an additional source of Income and helps us leading a luxurious life.
2. Managing Urgencies:- Money is never in abundance more we have more we want. Medical urgencies or any other kind of emergency can occur with anyone with us or anyone close to us. What can immediately save is ready availability of funds. If we have money when we need; it can save us from many problems.
3. Tax Advantages:- Maximum advantage of this policy can be availed if we start investing much before our vesting* age. This is because premium that we pay assists in saving our taxes as per section 80c.
4. Liquidity Benefits:- During the time of accumulation i.e when we are paying for Pension funds we can take funds in urgencies even before maturity.However, the amount we get may not be much but it may help us managing contingencies.This may be possible only after locking period is over i.e usually 3 to 5 years.
5. Insurance Cover:– The additional benefit of this policy is we can get life cover as well .This may act as a boon in case of any mishap. It acts as great support system especially for family i.e spouses; kids or parents. This applies only to specific plan that we buy.
6. We can chose our *corpus:– We can also choose the amount we want to pay as per our current Income and the amount we want during the vesting period. Most of the pension plans got that flexibility.

Types of Pension Plans

S.No	Plan Name	Details
1	Deferred Annunity Policy Plan	As per this plan, a policyholder is entitled to get annuity after fix period. Like if someone chooses a period of 25 years then they will get a deferment till that period. The period can be paid once or as regular Installments.
2	Immediate Annuity Pension Plan	According to this plan, annuity starts immediately after payment of premium.
3	Life Cover Policy	As is clear from the name of the policy there is additional coverage of Life provided.
4	No Cover Policy	This policy doesn't cover the life. Complete corpus amount is paid as pension Income.
5	Assured Annuity	This plan pays the annuity for a period as decided by the policyholder
6	Annuity Guaranteed Period	As per this plan, an annuity is given for some fixed time duration.It can be 5 years; 10 years o 15 years.

Not Limited to above there are many other plans as listed below

1. Annuity Life

2. NPS (National Pension Scheme)

3.Pension Investment Funds

How Ramya planned her Corpus during Vesting time?

Ramya; 25 years old Investment banker plans to retire at 50. She is currently earning around Rs.1,00,000 per month and she wants to get assured Income of Rs.50000 for 10 years ie till 60 years. She needs to Invest at least 60 lakhs to get that much of amount. Ramya can either choose to pay a lump sum or can Invest annually or after some interval as per Insurance plan she may choose.Definitely, the amount she will get will be much more than Investment due to interest and other funds that gets added timely as per the plan.

At the same time, she may choose to have Life coverage and no Life cover. Based on her needs she can go for any of the plans as above. Since she is single as of now; but plans to get married afer few years her decision to take the plan was based on that. As per her requriement she planned to take Deferred Annunity Policy Plan by 25 years of Term. She took the plan from Reliance Smart Pension plan. Annually she’s paying around Rs. 2,40,000 Lakh for the same.This plan is always helping her saving tax as well. She leads a happy life and is quiet prodcutive as work as she can retire young without any financial burden.

Vesting* Period:– It’s duration when we need assured monthy Income. It can be 5 years ; 10 years or 15 years based on our needs and requirements.

*Corpus:- It’s total amount that we may need to Invest that can give us required Income during Vesting period.

Current Leading Pension Plans with Details

S.No	Company	Term of Policy	Age of Vesting	Age Bandwidth
1	HDFC Life Guaranteed Pension Plan	10 years – 20 years	55 years – 75 years	35 years – 65 years
2	LIC New Jeevan Nidhi	5 years – 35 years	55 years –65 years	20 years -60 years
3	SBI Life Saral Pension	10 years – 30 years	40 years – 70 years	18 years – 60 years
4	Reliance Smart Pension Plan	10 years -30 years	45 years – 75 years	8 years – 65 years

In additon there are many others to choose from as mentioned below.

1. Bajaj Allianze Retire rich
2. Aegon Life Guaranteed Plan
3. Advantage Insurance Plan
4. BSLI Empower Pension Plan
5. HDFC Life Assured Pension Plan
6. LIC Jeevan Akshay
7. HDFC Life Personal Pension Plus
8. Reliance Immediate Annuity Plan

*Annual Premium & Sum Insured is based on corpus & vesting age.