Kotak e-Term Plan
Kotak e-Term Plan provides a high level of protection to your loved ones in your absence.
Kotak E-Invest Plan
Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs.
Kotak Guaranteed Savings Plan
Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality.
Kotak Lifetime Income Plan
Kotak Lifetime Income Plan gives you the security of your income continuing thru your life and in your absence throughout your spouse's lifetime!
Kotak Health Shield
Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability.
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Give Your Retirement Savings a Booster-Shot with Annuities
Experts say a retirement planning portfolio should balance at least three to four different financial instruments. Amongst other instruments available, buying a good annuity plan can stabilise your retirement planning strategy. Let’s know more about them and how they can boost your retirement savings.
What is an Annuity Plan?
An annuity plan is an insurance product that guarantees to pay you a fixed and regular pension to support your retirement years. Despite being an insurance product, it does not provide life cover. Instead, it offers safe and assured periodic pay-outs to support your daily expenses once you have retired.
Types of Annuity Plan
The annuity plans can be broadly classified into two types-
1. Immediate Annuity
In Immediate annuity plans, the insured pays a lump sum amount to buy the plan and starts receiving the pension pay-out immediately from the insurer. This type of plan is best suited for one who is nearing retirement or planning to retire soon.
In a deferred annuity plan, one can buy the annuity plan with a lump sum amount and choose to wait for a few years before the pension period commences. The waiting period between purchasing the annuity and the start of the pension amount is called the deferment period. A deferred annuity is best suited for individuals who have age on their side and are not planning to retire early.
Income Options with Annuity Plans
Annuity plans generally offer the following pension options to serve specific needs-
Salary usually stops immediately after the commencement of retirement. In such a scenario, you can keep receiving a regular pension with the help of annuities. The regular income can help you meet daily expenses without putting pressure on your main retirement corpus or emergency fund.
While there is no tax benefit on a pension received through the annuities, you can claim a tax exemption under section 80C on the purchase price of the annuity.
The rate of interest offered during the purchase of the annuity remains unchanged for the lifetime. This is the reason why you will keep getting the same pension amount for your entire life. You don’t have to worry about falling bank interest rates.
Annuity plans are non-participating. Therefore, the amount invested in an annuity is never invested in the stock markets. Hence, they are completely shielded from the stock market volatility. This makes them an ideal choice for risk-averse investments and retirement funds.
It is crucial to consider reputed insurance companies for buying an annuity plan. Choose only well-established insurers that will stay in business a few years or decades down the line when you have retired. Look at their solvency ratio and credit ratings to ensure they have a strong financial position.
The main idea behind the annuity is to keep the in-flow of money intact even after retirement so that you may concentrate on being a happy and boisterous retired person spreading positivity all around.
- A Consumer Education Initiative series by Kotak Life
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