What are Retirement Plans?
Retirement Plans are a category of life insurance plans that are specially designed to meet your post-retirement needs such as medical and living expenses. To ensure that you can enjoy your golden years with financial independence, these policies help you plan for your expenses and secure your future.
Why do I need to plan for my retirement?
- Increasing retirement years: With average life expectancy increasing in India, it has become increasingly important to plan for a longer retirement. The life expectancy figures indicate how long an average individual lives. In India, the average life expectancy of a person aged 60 is 17.5* years. This means that an average Indian lives up to the age of 77.5. Hence, you need to start planning in advance to maintain your lifestyle and take care of other expenses for such a long duration.
- Medical expenses: A major worry with increasing age is unforeseen medical expenses. Rising at 15-17%^ every year, such medical costs can be difficult to manage unless you plan for them in advance.
- Financial independence post retirement: You would like to live your life on your own terms after your retirement. However, more than 65%* individuals above the age of 60 depend on others for their daily expenses. This shows how important it is to plan for your retirement and ensure your financial independence.
*As per the 'Situation Analysis of The Elderly in India' report of Ministry of Statistics and Programme Implementation (MOSPI)
^Source: Outlook Money February 20, 2013
No matter what your need is, we have a solution
View details of our Retirement plans:
A plan that helps create retirement corpus for your golden years with the growth potential of equity and debt funds while also ensuring that you do not lose your money no matter what.*
- Choice of two funds that suit your needs
- Guarantee on the money you invest
- Pension Boosters to increase your retirement savings
*Assured Benefit amount assumes all due premiums as per the premium payment term are paid.
Make sure that you and your spouse live a comfortable life in your golden years with a regular income to take care of your daily expenses and more. You can also leave a legacy for your children.
- Guaranteed pension for life
- Critical illness benefit
- Pension with annual increase
- Start as early as age 30
Benefits of Retirement Plans:
- Guaranteed regular income for life: With Retirement plans, you and your spouse can receive regular pension for life.
- Security for your children in your absence: In some retirement plans, your children will receive a lump-sum amount in the absence of both you and your spouse. This helps you leave behind a legacy for your children.
- Tax benefits: Apart from enjoying a comfortable retirement, you can also enjoy tax benefits** on the premium paid up to a limit of ₹ 1.5 lakh. In addition, at the time of maturity, the pay-outs you will receive are also completely tax-free.
**Tax benefits are subject to conditions under Section 80CCC and 10(10A) and other provisions of the Income Tax Act, 1961. Applicable taxes will be charged extra as per prevailing rates. Tax laws are subject to amendments from time to time.
How much do I need to save for retirement?
It is important to consider your financial requirements after retirement to calculate the retirement kitty that will suit your needs. You must decide the amount required to maintain your lifestyle as well as take care of your increased medical expenses. You can arrive at the exact amount required through our easy-to-use Retirement Calculator.
Why should I start planning for my retirement now?
- Power of Compounding
If you start saving early, your money will get more time to grow. For example, if you start investing `1.5 lakh p.a. at the age of 45, your retirement savings will be `44 lakh at a rate of 8% or `31 lakh at a rate of 4%, by the time you are 60 years. However, if you had started saving the same amount from the age of 40, your retirement savings at 60 would be `74 lakh at 8% interest rate and `46 lakh at 4% interest rate.
- Increasing Inflation
After retirement, you will need regular income to meet your expenses.The later you start saving for your retirement, the more you will need to save. For example, if your monthly expenses are `35,000 at the age of 30, then by the age of 60, they will be `2.66 lakh## due to inflation. To meet these expenses, your retirement savings will need a monthly contribution of `27,000. However, if you delay your savings by just five years, this amount will increase to `42,500 per month.
##Assuming inflation at 7%