Finance

Choosing the Best Pension Plan in India With Good Tax Benefits

Why Pension Plans?

In this modern era, everyone has retirement plans. Everyone plans their coming years according to their financial situations. Sometimes most of us sacrifice or compromise our dreams due to the non-availability of sufficient funds in our bank accounts. That’s the reason why pension plans are so standard in our country. Our pension helps us maintain the standard of living, and savings allow us to spend on unseen future expenses.

Pension Plans provide us guaranteed monthly income for our life, which makes financial security at retirement. Even a person has a good amount of savings; everyone should opt for Pension Plans; it is nevertheless crucial. A Pension Plan helps you as a financial cushion in the long term to have a financially sound future after retirement.

Here are the main reasons why we opt for Pension Plans.

Rising Medical Costs

We are all aware of our country’s rising medical costs and expenses. Hospital bills and doctor’s consultancy fees are increasing day by day. Even on hard days, we can manage our medical bills or handle any accidental situation in our lives.

Regular Income

Pension Plans provide us with a steady flow of income after retirement. It’ll help us lead a good life along with our personal and family financial expenses. We don’t need to seek help on financial terms even after retiring from work.

Tax Benefits

It’s always beneficial to have a Pension Plan at an early age. Opting Pension plan will also give us tax benefits under the provisions made by Section 80C of the Income Tax Act.

Best Pension Plans to Choose in India

Here is the list of the top five best pension plans in India to fulfil your primary requirements. Whenever we talk about investment, we should choose wisely.

LIC Jeevan Akshay 6 plan

It is an immediate plan. After paying a specific amount plan starts, and the payouts are quick. See the below benefits:

Receive pension monthly, quarterly, half-yearly, and yearly.

A medical examination is not required.

Premium is exempted from tax.

LIC Jeevan Nidhi Plan

It is known as a profitable Pension Plan. The policyholder’s accumulated amount (i.e. sum Assured + Guaranteed Additions + Bonuses) is used to generate a pension for the policyholder. Refer to the below benefits.

Premiums are exempted under section 80C of the Income Tax act up to Rs. 1.5 lakh.

No maximum limit for the basic sum is assured.

Guaranteed Additions @ Rs.50/- per thousand sums Assured for each completed year, for the first five years.

HDFC Life Guaranteed Pension Plan

This Pension Plan can opt only on a single life basis. Here are the benefits.

Tax benefit under section 80C of the Income Tax Act.

Assured Death Benefit of the total premiums paid till date are accumulated at a guaranteed rate of 6% p.a. and are annually compounded.

ICICI Pru – Easy Retirement

This Pension Plan provides regular income on retirement. It guarantees the amount invested along with interest growth and protects against the changes in the market. Have a look at the benefits.

Receive pension monthly, quarterly, half-yearly, and yearly.

Minimum premium of Rs. 48,000 per annum without the maximum limit.

Policy term ranges from 10-30 years.

SBI Life Sarah Pension Plan

In this Pension Plan, options of the opt-out and complete withdrawal are available in the form of pension. Here we go for the benefits.

Bonuses for the first five years are guaranteed.

The minimum sum assured of Rs. 1 lakh with no maximum limit.

Forty years is the minimum maturity age, and 70 years is the maximum age.

How does Fixed Deposit Compound Interest Calculator work?

It is always advisable to check how the interest is calculating against our investment or fix the deposit amount. Here we can take help from the fixed deposit compound interest calculator. It’s an easy method to calculate interest. The interest is calculated by multiplying the principal, interest rate, and tenor. The formula for Simple Interest (SI) is “principal x rate of interest x time period divided by 100” or (P x Rx T/100).

Must Read: A Comprehensive Guide on Income Tax Calculator

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