Here’s All You Need To Know About Savings Plans
Since our childhood, our parents have explained the importance of savings to us. Understanding the benefits of savings in our youth helped us learn the habit and apply it to our financial planning when we grew up. Over a period of time, the concept of saving money has evolved, and you can now opt for a plan that offers profits from savings with the benefit of insurance coverage. This plan is called the savings life insurance plan.
What are savings plans?
The savings insurance plan can be called the best saving scheme in India because it helps individuals invest their funds systematically to achieve their short-term and long-term financial objectives. Insurance companies offer savings plans with different features which help individuals meet their specific financial needs depending on their suitability and risk profile. These plans also help you earn great returns throughout the tenure of the plan. You can select the savings plan with life cover, such as money-back plans, endowment plans, income plans, etc., depending on your personal needs.
Reasons why a savings plan is considered the best money-back plan
1. Policy tenure and entry age:
The savings insurance plan provides a broad age group with the ability to purchase this plan. You can also customize the policy term or investment tenure, depending on your requirements. Your entry age will determine the amount of risk you can take on, which helps you personalize the savings based on your risk profile. You can also modify the policy term and the investment tenure as per the plan options. This allows you to accumulate a significant amount throughout the policy tenure.
2. Rider options with life cover:
When you opt for the savings insurance plan, you can safeguard your family’s financial stability in your absence and earn returns through market-linked investments as well. You can also optimize the coverage by adding different riders to the plan for more comprehensive coverage. These riders will help you improve financial protection by covering events like accidental death, disability and life-threatening ailments.
3. Tax benefits:
The premium amounts paid to keep the policy in effect are eligible for tax deductions under Section 80C of the Income Tax Act. The maturity and death benefits received from this insurance plan are also suitable for tax exemption under Section 10(10D) of the Act.
Some advantages of a savings plan with life cover:
- Guaranteed payouts which can help you fulfil your life goals.
- Helps in building long-term wealth creation.
- List of bonuses that add to the guaranteed payouts.
- A comprehensive death benefit to beneficiaries.
- Financial security against terminal diseases.
- Choice of riders for enhancing life cover.
- Tax benefits on premiums under Section 80C of the Income Tax Act.
If you’re on the look-out for the best saving plan for your short-term and long-term financial goals, you can follow the steps listed below:
- Learn about the different savings plans available in the market and compare them. A simple way to figure out which plan would be suitable for you is by looking at their features.
- Read about whether the savings plan offers flexibility to withdraw money for emergencies or not. This feature can come quite handy for handling difficult circumstances.
- Research about the rider options that you can avail from the plan to maximize the plan’s coverage.
- Make use of the savings calculator to find the ideal coverage and premium, which is payable for the savings plan and determine the exact guaranteed benefit that you will receive. Using the calculator will help you immensely when deciding the terms of your plan.
Thus, if you are looking for the best saving scheme in India that offers the benefit of insurance coverage, you can consider the savings insurance plan. This plan provides the advantage of insurance coverage along with growing your wealth. You can also add different riders to the plan, which will help you enhance your plan’s coverage.