How to Select the Right Retirement Plan?
Updated On Sep 26, 2021
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Selecting a right retirement plan is an important step that needs to be taken by an individual in their lifetime. To ensure a financially safe future for you as well as your loved ones, it is necessary to go for the right pension plan. Given below are a few points that you need to consider while opting for a right retirement plan:
Flexibility of Premium PaymentOne must always select an insurance policy that gives them the flexibility with regards to changing the amount of premium. As you climb your career ladder, the capability to pay a high premium amount would also increase. Thus, it is suggested to opt for an insurance plan that provides maximum flexibility and an option to increase the premium amount through top-ups each year.
Must Read: When Should One Purchase A Retirement Plan?
Right Insurance PlanWhen you are planning your life after retirement, you must select an insurance plan that can deal effectively with inflation and provides you with returns that would be enough to your requirements post retirement. Additionally, the insurance policy that you decide to purchase must complement your current retirement savings. For example, in case most of the investments made by you are done in equity instruments, then the retirement policy must focus towards the debt instruments. To receive the optimum value for your money invested, do the comparison of insurance quotes on premium basis and returns online.
Additional BenefitsAt the time of purchasing a retirement plan, you must carefully assess the benefits and bonus that are provided to you along with the insurance policy. Benefits offered such as it assist in maintaining the future goals of the policyholder even when you are not around by self-funding the premiums in the event of untimely demise of the policyholder, whereas the added benefits like loyalty bonus provides you with a huge amount upon your retirement.
Pension GuaranteeMaking an investment in the retirement plan is not all about safeguarding your future after your retirement but also about protecting the future of your spouse. An ideal retirement policy is the one that looks after the requirements of your financial dependents in your absence. This insurance policy guarantees a pension for your legal partner in the event of sudden demise of the policyholder, thus it is a must to buy this insurance plan. During the demise of the policyholder, the lump sum amount that equates to around 30% of the premium is paid either to the dependent or the dependent is allowed to make withdrawal anytime during the annuity period. The remaining amount is paid as pension on a monthly basis.
These are some of the crucial points that one must keep in mind when choosing a retirement plan to safeguard the future of themselves as well as their dependents.
Also Read: Why Do We Require Retirement Planning?
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.