How To Choose The Right Pension Plan?
Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

How To Choose The Right Pension Plan?

How To Choose The Right Pension Plan?
  • 26th Nov 2021 |
  • 661

A pension plan is a smart way to build a retirement corpus and use it for receiving a steady income for covering your post-retirement expenses. But with so many options now available, how will you pick the right pension plan?

Here are four factors that can help you make the decision-

1. Asset Selection Flexibility

One of the most critical features a pension plan should offer is the flexibility to choose your preferred asset classes so that you can diversify your investment. For instance, if you are in your 20s-30s, you can have a more aggressive investment approach, with equity being the significant component of your portfolio.

In the 40s-50s, the stability and safety offered by the debt class can help you keep your investment protected. The plan provider should offer this option to choose and switch between asset classes to help you make the most of your investment throughout the various stages of your life.

2. Guaranteed Additions and Bonuses

Many pension plans also come with guaranteed additions to the sum assured for up to 5 years from the plan purchase date. The additions are mostly a certain percentage of the basic sum assured and are payable either on demise or vesting.

Moreover, you can also find plans that offer additional bonuses from the 6th year of the policy. Note that these additions and bonuses are generally over and above the assured plan benefit, which can be up to 105% of the basic sum assured.

3. Life Cover and Add-ons

Pension plans are available with and without life cover. It is generally recommended that one choose a plan with life cover to ensure financial security for the family. With these plans, the nominee will receive the basic sum assured, along with the additions and bonuses, on the policyholder’s unfortunate demise.

Some insurers also offer additional riders such as accidental death benefits and permanent disability benefits for extra security.

4. Entry Age and Vesting Age

Like most other types of investments, the sooner you purchase a pension plan, the higher the probability of building a large retirement corpus. All the insurers have different entry age limits. In most cases, you should be able to purchase a pension plan if you are 30 years and above. However, you’ll mostly not be allowed to buy a pension plan if your age is already 55-60 years.

The vesting age is the age after which you’d like to start receiving the pension. In most plans, the vesting period is between 45-70 years. Do check the entry age and vesting age while browsing through the options to choose one that best meets your requirements.

Ensuring Financial Stability After Retirement with a Pension Plan

While there are options like PPF and EPF for private employees, inflation will hugely impact the corpus these investments generate for your retirement. A pension plan is a smart addition to any retirement plan to boost your corpus and ensure financial stability essential for living a comfortable retirement life.

Focus on the factors discussed in this post while comparing pension plans offered by top insurers to make the right decision.

Kotak e-Invest

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Download Brochure

Features

  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

What is ULIP and Its Benefits?

NPS for Housewife

5 Reasons Why ULIP Plans are One of The Best Retirement Planning Instruments

Retirement planning with a systematic life insurance plan

What is the Difference Between EPF, VPF, and PPF? What are Their Tax Benefits?

Here's Why it's a Good Time to Explore ULIPs as an Investment

How Safe is it to Invest in ULIP plans?

Different Types of ULIP Investments in India

Un-Retirement - Are You Ready For It?

7 Secrets that can Make Your Post-Retirement Phase Prosperous

What Are Mortality Charges In ULIP?

How Does Pension Plans in India Works?

How to Win at Retirement Savings?

What Are Superannuation Benefits?

What is the difference between Life Insurance and ULIP?

Do ULIPs Give Good Returns On Investments?

How to Choose the Best ULIP Plans to Invest in 2022?

The Significance of Number 8,000 in Retirement Planning

How Is ULIP Different from Other Life Insurance Plans? Where Can I Invest - ELSS, ULIP, or PPF?

Is it possible to live a financially independent life, even after you retire?

Benefits of Early Retirement Planning in India

How Can I Achieve My Wealth Goal with ULIP Investment?

What is Premium Redirection in ULIPs Plans | ULIP Insurance Plans | Kotak Life Insurance

Why ULIP Should Be a Part of Your Investment Portfolio?

Top 4 Mistakes To Avoid While Planning For Your Retirement

Difference Between Unit-Linked Insurance Plans and Non-Linked Plans

5 Common ULIP Myths That You Should Stop Believing

5 Retirement Planning Tips for a Financially Controlled Post-Employment Life

5 Notable Investment Options for Retirees

What are the Advantages and Disadvantages of ULIP?

How Does NPS Work?

Which are the Best ULIP Plans in India for Children?

Invest for your second innings with a guaranteed savings plan

Top 6 Reasons Why You Should Get A Pension Plan

ULIP Plan or Traditional Insurance Plans - Which is better?

How has ULIP Grown Over the Last 3 years?

Is ULIP a Complex Financial Product?

A Beginner's Guide to Understanding 401k Retirement Plan

What is Fund Value in ULIP?

How should one decide on fund allocation within NPS?

Getting Close to Retirement? Six Key Retirement Planning Tips That Can Help You Retire

What is Partial Withdrawal in ULIPs?

Terminologies You Should Understand About Retirement Plans

How Much Corpus Does One Need for Retirement?

What are the 4 Financial Phases of Retirement? How to Budget For Each One?

Calculating a Retirement Corpus that can Support Your Lifestyle

How Do Annuity Options Work In NPS

What are the Charges Levied on ULIP?

Why You Should Invest In An Annuity Plan?

Ten Signs That You're Ready to Retire

Is the ULIP Policy Surrender Value Taxable?

Understanding Annuity Plans

10 Steps to Figure Out How Much Money You Will Need For Your Post Retirement Plans

यूलिप के फायदे (Benefits of ULIP in Hindi)

How Does ULIP Work in India?

Which Pension Plan Suits You best?

Worried About Running Out of Money in Retirement? 4 Tips to Avoid This Crisis

ULIP Tax Benefits: यहां निवेश करने पर मिलते हैं 5 बड़े फायदे

What is Lock-In Period in ULIPs?

What is the Estimated Return Percentage on ULIP? Do Investors Get Compound Interest?

What are the Benefits of ULIP - Explained

Looking for Ways to Earn Lifetime Income in Retirement? Here Are 6 of the Top Options

Why Should You start Retirement Planning as soon as you start a job?

What are the Rules for Exit From NPS?

Here's What Retirement Would Look Like 30 Years From Now

Does Having Both ULIP Plan and Other Health Insurance Plan Make Sense?

6 Signs That You Are Not Financially Ready For An Early Retirement

Pros and Cons of Retirement Annuities

How can NPS help you save tax?

ULIP: Can You Surrender ULIPs or Withdraw Money from It?

How Can ULIPs Help You Plan for Your Child's Future?

Is it Advisable to Withdraw the ULIP Insurance Policy After 5 Years?

What Happens to ULIP Premiums Paid if the Market Crashes?

8 Charges in ULIP That You Must Know

What is a Retirement Plan - What are its Features?

Importance of Retirement Planning

Retirement Planning at 50? You Are Still Good to Go

What tax benefits are there on saving for retirement?

Retirement Planning Guide: These 5 Steps Will Help You Towards a Safe, Secure and Fun Retirement

Benefits Of Retirement & How Investments Can Help You Enjoy Them

Types of Annuity Plan | Annuity Definition - Meaning & Key Benefits

Tips to invest your voluntary retirement scheme money

What is the Death Claim Payable in the Case of ULIP?

Do Pension Plans Allow any Death Benefits?

Different Types of Retirement Schemes

How to Build a Tax-Free Pension Income for Retirement?

What is the Minimum Lock-in Period for ULIP?

Give Your Retirement Savings A Booster-Shot with Annuities

ELSS vs ULIP: Which is a Better Investment?

Retirement Planning Guide for Working Men and Women

Is It Worth Buying ULIP Plans For 10 Years?

What are ULIPs and their Types?

Importance of financial Planning for Retirement

ULIPs or Pension Plans – Which is a Better Retirement Plan?

What is NAV in ULIP, and How is it calculated?

What is an Annuity Plan, and How Does Annuity Plan Work?

Best Insurance Plans for a Guaranteed Monthly Income After Retirement!

Single Premium ULIP or a PPF - Which One is Better?

Save Early to Keep Living Your Dreams Post Retirement

Are You Planning an Early Retirement? Here's Why Buying Annuity Plan Will Make Sense

What are the Differences Between ELSS ULIP and Mutual Funds?

What Happens If I Stop Paying My ULIP Policy Premium After Paying the First Premium? Will I Still Get The Return?

How To Calculate The Present Value And Future Value Of Annuities?

यूलिप के 8 शुल्क

Inflation: A Key Factor to Consider into Retirement Planning

What To Do With Your Retirement Accounts During An Employment Lapse?

10 Steps to Figure Out How Much Money You Will Need After You Retire

Benefits of Early Retirement Plans

Why Should You Invest in NPS?

What are the minimum and maximum investment in ULIP? Would the Whole Amount Insured in The ULIP Insurance be Invested in the Market?

Meaning of Sum Assured in a ULIP

How Quickly is Fund Switch Effected in ULIPs? Is it Done the Same Day or After a Particular Number of Days?

Can I Surrender My ULIP Policy after 2 Years?

Why are ULIPs One of the Best Tax Saving Instruments?

Are Annuities Great For Early Retirement?

What are the Uses of ULIP?

How To Make Most of Your Money After Retirement?

At What Age Should You Start Your Retirement Planning?

Saving for approaching retirement with retirement insurance

Retirement: A New Start to Life!

How Has NPS Performed in Comparison with Other Instruments?

Is ULIP A Good Investment Option?

Is it Suggestible to Take a ULIP Plan Linked with a Term Plan?

Annuity Plan | How to Choose the Right Annuity Plan | Kotak Life

Top 4 Myths About ULIP Investments You Should Know

Advantages of Pension Schemes and Retirement Plans

Top Investment Options for Retirement Planning

Types of Retirement Plans

Which Is Better: ULIP or SIP?

What are the things to consider before buying ULIPs?

A Quick Guide to Retirement Plans

Types of Pension Plans for Your Retirement

5 Reasons to Buy ULIP for a Secured Financial Future

Is ULIP Better Than FD?

Is ULIP a Good Option for People Above 60?

Who Gets the Benefit After the Maturity of ULIP: The Proposer or The Life Insured?

Top 6 Flexible Benefits That ULIPs Offer

5 Steps to Gift a Smart Retirement Plan to Your Parents

Why Are ULIPs Called Flexible Investments?

Retirement Planning for Millennials

Retirement and Pension Plans in India- What are Your Options?

FAQs on Taxation of ULIPs

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

Why Should I Invest in ULIP?

What Are Retirement Pension Plans?

Long Term Investment Guide for Your Retirement

Know Why You Should Stay Invested in Your ULIP Plan

Demystifying the Retirement Planning Process

What are the Chances of Losing all my Money in ULIP and How Much Return Should I Expect?

Retirement Planning - How To Calculate Your Retirement Premium in India?

Why Should Retirement Planning Be on Top of Your Priority List?

What are the Instruments Available for Building a Retirement Corpus?

How To Keep Your Retirement Accounts from Being Hacked?

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

Can NRIs Invest in ULIP Plans Offered in India?