Retirement is a watershed moment in life, a new beginning. A successful retirement, on the other hand, entails spending your time leisurely, without financial concern. Is it possible, however, to do so without meticulous financial planning? Remember that retirement only frees you from work, not from financial obligations. This is why you need the best pension scheme in India to secure your old age.
Although retirement is on the minds of the vast majority of working people, only a small percentage do retirement planning. According to HSBC’s The Future of Retirement report, approximately 68 per cent of working-age individuals rely on their children to support them after retirement. This is primarily due to people’s lack of preparation. Every working person should plan for their retirement. But what if you don’t know how to choose the best retirement plan in India? Read on.
Things to Consider Before Selecting Right Pension Plan
Some of the important tips before selecting the right pension plans are described below.
- Inflation-Adjusted Returns
One important consideration is to select a plan that provides inflation-adjusted returns. This implies that you should choose a pension policy that provides returns that are unaffected by inflation after you retire. The plan’s returns must be high enough to offset the impact of rising inflation.
- Guarantee Pension For You and Spouse
Successful retirement life is one in which you spend your golden years with your spouse and loved ones. Because you are responsible for your spouse and dependent family members, ensure that your plan includes a provision for financial support in the event of your untimely death. The plan provides a pension to your spouse, ensuring economic freedom in your absence. You must choose a plan that provides financial security for both you and your spouse.
- Offers You Flexibility
Putting money aside for retirement should begin with your first pay-check. However, as you advance in your career, your salary will rise. As a result, it is critical to choose a retirement plan that allows you to increase the premium payout. The best pension schemes in India allow policyholders to increase their premium contributions through top-ups. As a result of the power of compounding, the retirement fund grows significantly.
- Offers You Bonus and other Benefits
They offer many benefits to the policyholders including:
- Regular Income post-retirement
After your retirement, you are entitled to receive a set amount of money without delay on regular basis.
- Insurance Cover
Most of the retirement plans include life coverage to protect the policyholder and his family from financial hardship.
- Tax Benefits
The policyholder can avail of tax exemptions on the premium pay-out with for the policy as per section 80C of the IT Act,1961.
- Other Benefits
The best plans provide additional benefits to policyholders such as loyalty bonuses and the option of adding riders to enhance life coverage.
Retirement planning is necessary for all working individuals as it helps you to lead a comfortable life after retirement. A pension calculator available online can help you in calculating the right amount required for financial freedom post-retirement.