If you’re looking to retire comfortably without any financial headaches, then guaranteed income plans are your best bet. They ensure fixed/guaranteed savings/income at a time when market volatility and fluctuations have made several investors risk-averse. Choosing the best guaranteed income plan means that you get a long tenure for your investment, along with fixed returns that are clearly laid down at the outset. At the same time, you also get added advantages such as tax benefits and life coverage. Let us know more about their key features below.
Best Guaranteed Income Plan- Key Aspects Worth Knowing
The best guaranteed income plan will be more like a traditional plan for building your savings, with the extra benefit of life insurance coverage. Here are some of its key features that you should know more about.
- Guaranteed income plans offer fixed income or payouts during or after the policy term. This may help you build a regular stream of income after retirement.
- You can get to know the fixed return at the time of purchasing the plan itself. Premium payment terms vary and may range from limited pay options to regular pay throughout the policy term.
- You can also choose the frequency of income payouts and their structure. This can be monthly, quarterly, annually, and so on.
- The income that you get is guaranteed and can be for a fixed duration or for your lifetime, depending on the plan you choose.
- There are multiple plan choices that ensure ample flexibility to get income as per your needs. You can get it for a fixed duration or for your lifetime, depending on your requirements.
- You can get tax benefits on the premiums paid under Section 80C of the Income Tax Act, subject to conditions. Maturity proceeds may be tax-free under Section 10(10D) if specific criteria are met.
- Life insurance coverage is provided for the whole duration, ensuring financial protection for your family. In case something happens to you during this time, the insurer will pay out the sum assured to your family members/nominees. They can use the funds to repay debts, meet household costs, and take care of future goals even when you are not around.
- Additional riders may be available to enhance your policy. These may include terminal/critical illness, accidental death or disability, or waiver of premium in case of specific conditions like disability. Spouse cover may also be available under specific plans such as joint-life annuity plans.
As you can see, the best guaranteed income plans go a long way towards helping you maintain your lifestyle even after retirement. You can pay high premiums during your working years and then get the advantage of fixed income without market fluctuations in your post-retirement years. Simultaneously, you also get life coverage throughout the plan period, which financially safeguards your family in case anything happens to you. So, it’s a win-win scenario in its essence.
Also Read: Income Tax 2023-24: Understanding How to Switch from the New Tax Regime to the Old Tax Regime
