Having a financial resource pool to fall back on for achieving those life-long dreams accounts for a wise decision. Investing in a saving plan ensures not only a secure future, but also acts as an insurance cover that is built-in to safeguard your loved ones in your absence.
A savings plan helps you inculcate a disciplined attitude towards saving your finances and helps avoid reckless spending like there’s no tomorrow. To strike a perfect balance between the two, you need to opt for a good savings plan that offers benefits and guarantees protection for you and your family.
While there are several things to consider before choosing a savings plan, you must take the following into consideration to avail of the best possible savings plan that aids your financial well-being.
1. Benefits Offered
With so many investment opportunities out there, a savings plan is ideal for future-oriented, far-sighted individuals who think long term, as these plans reap benefits such as:
a. Tax benefit – Currently, under section 80C of the Income Tax Act, 1961, you are eligible for deductions up to Rs. 1.5 lakh against your savings policy.
b. Financial Protection – A hassle-free experience is guaranteed for your family in terms of finances if any untoward incident happens to threaten your life.
c. Sum Assured – A savings plan serves the dual purpose of being a safety net for finances in the future, as well as a life insurance plan that protects you and your family with coverage up to sum assured and fixed returns
d. Customized plans – Different people have different life goals, and a good savings plan caters to those diverse needs by providing customizations on the plan
2. Policy Maturity
Savings plans have assured maturity benefits that one can avail of, either in lump-sum or regular periodic income, as and when the policy term ends. But it is not limited to that. A good savings plans will help you reach your goals faster than what you initially planned.
3. Flexibility in Premium Payment Options
You might have some disposable income that you would want to invest initially in a savings plan. Later, the premiums can be paid on a monthly/quarterly/annually or half-yearly basis. This flexibility allows for some room for you to pay your premiums easily and without fault.
4. Entry Age
A savings plan allows a policyholder to analyze risks and identify their risk tolerance as per a person’s age and preference. This is crucial to consider as the entry age will determine how much risk you can tolerate later in life.
5. Riders In Savings Plan
Riders act as add-on protection on your base plan to ensure that you are covered for multiple incidences. Riders can maximize your coverage benefits with enhanced insurance on the following.
a. Accidental Total & Permanent Disability
b. Term Rider
c. Premium Waiver Rider
d. Hospital Cash Benefit Rider
e. Accidental Death Benefit
Note- These Riders are not mandatory and are available at an additional cost.
6. Policy Loan
A savings plan helps you take out a loan against your active plan after it reaches a specified amount. It offers low interest rates and can help you in the nick of time when there’s an emergency to be dealt with.
7. Retirement Savings
If invested for the long term, for example, up to 50 years, a savings plan can turn out to be a sizable sum that can help you financially when you are old and retired. This is an important feature of a good savings plan as you get regular income for easy cash flow. This cashflow can be utilized as a pension fund for your retirement.
These seven tips can change the way you look at investment. With these tips, you can save money effectively , and it also serves as a budgeting tool for when you need a steady flow of income at pre-determined intervals.
For ensuring a secure future, you should look for credible and trusted insurance providers only. Bharti AXA Life is a big name in the life insurance market, and they have savings plans that adhere to your needs and help you identify them to buy a plan best suited for you. You can visit their website for more information on different savings plans and the riders available.
