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Retirement Benefit Plans in India

By Archana

Retirement is withdrawal from one's position or occupation from active working life. After retirement, one will not get to enjoy the benefits of monthly salary which otherwise was a monthly affair.

Start Early

Start Early

To continue to enjoy the monetary benefits even after retirement, Government and many private sector companies have introduced Retirement Schemes, which not only helps individuals to get the regular monthly income but also provides a source of security post-retirement for the family as well.

One can start investing in these policies as early as 25 years and can continue funding until the age of retirement. A right pension plan allows an individual to plan for the withdrawal in a phased manner. So it is advisable to choose the best pension plan to meet one's requirements.

Pension Plans

Pension Plans

There are many retirement plans currently available in the market in India.

Prominent among them are:

  • National Pension Scheme by Government of India
  • LIC's Jeevan Akshay 6 Plan
  • LIC's Jeevan Nidhi Plan
  • SBI's Life Saral Pension Plan
  • HDFC's Life - Click2Retire
  • HDFC's Life - Assured Pension Plan
  • ICICI Prudential's - Easy Retirement
  • Reliance's - Smart Pension
  • Bajaj Allianz's - Pension Guarantee
  • Max Life's - Guaranteed Lifetime Income Plan
  • Birla's - Sun Life Empowerment Pension
  • Benefits of Retirement Plans

    Benefits of Retirement Plans

    Benefits of investing in Retirement Plans

    • Regular income for life - By investing in retirement schemes, one can get monthly income after retirement till death. It will act as a backup fund apart from the other savings amount.
    • Tax Benefits - It provides tax benefits to the individual investors. An investment amount of up to INR150000 per annum is eligible for tax exemption under Section 80C of Income Tax Act.
    • Security for Spouse - In case of death of the investor, the spouse will be entitled to get the invested amount along with the accumulated interest amount.
    • Security for Children - In case of death of the investor and spouse, the investor's children will be entitled to get the invested amount along with the accumulated interest amount.
    • Protection against inflation - Rate of inflation keeps on increasing every year, and it will be difficult to meet both the ends post-retirement as there is no regular income from salary. To resolve the issue monthly income from pension schemes comes in handy during old age.
    Right Pension Plan

    Right Pension Plan

    Tips to choose the Right Pension Plan

    • Understanding one's personal needs - It is vital for one to know how much of money will be essential for sustaining the family post-retirement. One has to consider even inflation factors.
    • Calculating Risk - It is essential to estimate the risk involved in investing in retirement plans as some amount of investment will depend on the market performance.
    • Understand retirement Planning Options - There are many retirement benefit policies available in the market, one has to choose the plan which best suits his/her requirement after evaluating it carefully.
    Benefits at ripe age

    Benefits at ripe age

    To receive fruits of benefits at the ripe age, it's better to plan early in life and start investing wisely in the schemes which will provide benefits post-retirement. These plans provide financial security during old age. It helps to accumulate savings and get lump sum amount as a regular income after retirement.

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