Pension Plan: How to Choose the Right One?
You will inevitably retire from active service at some point in your life. The answer to a successful and comfortable retirement is having a healthy corpus retirement fund and have regular income by means of a pension plan. This article will help you choose the best pension plan available in the market.
Retirement planning is one of the most significant financial responsibilities for every working professional. If you neglect it, you may regret it later as you outlast your savings and won’t have enough funds to live a self-sufficient post-retirement life. It is, hence, essential to begin investing in a pension plan at an early age. But how do you select the best pension plan? The following suggestions will help you.
One of the best factors to determine which pension plan is best is to see if the plan gives inflation-adjusted returns. What this means is that the pension plan you select must provide returns that are not influenced by the current inflation post-retirement, the value of the funds must increase with the elevated level of the costs of goods and commodities.
Guaranteed pension for you and your spouse
Leading a financially independent and comfortable retirement life is something that you want to share with your spouse and loved ones. To achieve this, one of the critical factors to contemplate while assessing a retirement policy is to verify if it ensures pension to your spouse in the event of your untimely death. This is essential to secure the interest of your spouse when you are not around. The pension plan you pick must provide to the needs of both – you and your partner; a reliable plan will guarantee that your better half continues to get the monetary benefit even in your absence.
While it is desirable that you start investing in your pension as soon as you get your first salary, the capacity to pay a higher premium may increase gradually over the years as your income increases. It is, therefore, prudent that you pick a pension plan offers you the versatility to increase the premium contribution through top-ups. Even a small increment of the premium every year would increase your corpus considerably over a period.
Bonus and additional benefits
While looking for best retirement plans in India, it would be worth assessing if the plan offers you additional benefits or bonus. Like some pension plans offer a loyalty bonus over a period. This will significantly help you acquire a more significant sum in your retirement fund.
Assured income option
No matter how much ever you save during your working life, there is always a chance that you will run out of money ultimately. It is, hence, necessary that you arrange constant, guaranteed income for life. Make sure that you look for a pension policy that provides guaranteed income during your post-retirement life.
There are various types of pension plans that provide the above options, and you can choose a pension plan that suits your requirement.