Retirement pension plan are a great wealth creation instrument to ensure you build the required corpus for the second innings of your life. The plan offers you the benefit of investment along with insurance. It typically has two phases. The first stage is when you make payouts towards the plan and the money is accumulated through the tenure. This money is invested in securities to grow to the desired corpus amount. The next stage is called as the vesting stage wherein the investor begins to get payouts from the investment. The investor chooses the vesting age and is mostly from the age 40 to 70 years. But to reap such benefits, it is important that one chooses the right retirement pension plan for his retirement. Here is how you can choose one –
What is your requirement?
Before you decide on a plan you must be sure of the retirement corpus you want and the time at which you want it. So determine your age of retirement and the number of years thereafter you’ll need cover for. While deciding the amount you need, take into consideration medical conditions, obligation towards children, number of dependents etc. This will guide you while calculating the retirement corpus. Also, you can use the calculator in the provider website to understand the suitable sum assured and the premium payable for it.
The premium amount you need to pay holds a crucial role in choosing a plan. Compare the different retirement pension plans in the market and select one that matches your budget the best. This does not mean that you choose the cheapest plan available and compromise on the benefits you get. Check the bonus declaration clauses and see if limited period premium payment options are available or not.
Features of the plan –
Every plan in the market has different features to offer. You need to compare them and see if they match your needs and lifestyle. In case you prefer paying the premium for a limited period of time, then look for plans that offer such an option. Also, check if the plan gives you terminal illness benefit. Most of the plans these days provide bonuses for retirement plans so you can be sure to get a good amount on maturity.
Plan flexibility –
It may happen that events may take a different course from how you plan them to be. In such a situation having a retirement pension plan that gives you the required flexibility comes handy. So choose a plan that can help you meet the current demands as well. In case of death of the insured the money should go to the nominee.
Sarita Mane is an experienced author with keen interest in financial subjects and has a number articles to her credit based on topics related to Retirement pension plan.