What is the solution?
Systematic savings made year by year would not just help you to secure your old age period, but it would also make you rich by adding accumulated bonus and profits to your base amount. One such kind of systematic savings plan is offered by insurance companies. The plan provides a fixed amount in the retirement age at regular intervals. It works exactly the way government pension schemes work. Along with this, it offers insurance solutions as well. Hence, it is termed as a pension plan.
Importance of a pension plan
Pension received by government employees during retirement, is less than the half of the amount they are used to get as salary. Even in private segment, the amount received called as gratuity is not sufficient to fulfil the old age needs. Therefore, whether or not you have any other source of income for those retired years, you should definitely plan for a retirement plan available with insurance companies.
There is no dearth of pension or retirement plans in the insurance market. To have a best possible plan for you, you need to compare pension plans. And before that you are required to estimate your needs in your old age on an approximate basis.
How can you get the best out of your chosen retirement plan?
Buying a retirement plan, of course, is an end to your worries for your old age requirements. Nonetheless, you can always optimise your ways to augment your savings invested by you in your systematic planned retirement scheme.
Here are three tips that can increase your chances of earning a good amount of return on your insurance plans.
Start as early as possible: Starting early means to start saving when you have a lot of time left in your retirement. Most of the people prefer buying the plan when they are around 40 years of age. If one can start when he is in late 20's, it would give him the edge over those who start at 40. Moreover, you will not have to allocate a larger amount. A small percentage of income saved every month, quarter or in a year can also help you to secure your old age with ease.
Save as much as you can: Though a smaller percentage of your income saved for the old age is sufficient, if you start saving when you are young, however, the return very much depends on the amount of your savings. Therefore, try to save as much as possible. The more you save, the more will be your return, the more will be the interest accumulation.
Invest in equities: Equity market is known for those investors who have a high risk taking capacity. Needless to say, you are able to earn more when you take risks. Therefore, a little bit risk while investing in pension plans is worth taking. Not much, but at least 25 to 40 percent can increase your returns and consequently grow your corpus amount considerably. However, again, it is worthwhile to take a risk only if you invest while you have a long-term horizon.
But before making your purchase, compare pension plans of various insurance companies. You can get a comparison done at the ease of your home on various web aggregators' sites. Evaluation of various plans at one place gives you an understanding of the insurance market place that offers pension schemes and helps you to pick the best suitable plan for you.
Policyx is the insurance comparison portal where you can compare various insurance policy like Term insurance, Health insurance, Child insurance, Pension plan, Car insurance