Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak Guaranteed Fortune Builder

A plan that offers guaranteed income for your future goals. Know more

Kotak e-Term

Protect your family's financial future. 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 life cover. Know more

Kotak e-Invest

Insurance and Investment in one plan. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more

Close

Get a Call

Enter your contact details below and we will get in touch with you at the earliest.

  • Select your Query

Thank you

Our representative will get in touch with you at the earliest.

How To Choose The Right Pension Plan?

A pension plan is a smart way to receive a steady income for covering your post-retirement expenses. Read more to know how to choose the best pension plan for yourself.

  • Nov 26, 2021
  • 1,621 Views

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 Life Time Income Plan

Download Brochure

Features

  • 6 Plan Options
  • Tax benefits ^
  • Higher annuity rates for higher purchase price
  • 4 Annuity Modes

Ref. No. KLI/23-24/E-BB/1052

T&C

- A Consumer Education Initiative series by Kotak Life

Similar Articles

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

Top Investment Options for Retirement Planning

Pension Funds In India – Meaning, Overview, How Do Pension Funds Work, Types, Pension Plan Features and Tax Benefits

ELSS vs ULIP: Which is a Better Investment?

Long-Term Investing: Boost Retirement Income with an Income Booster

How Much Corpus Does One Need for Retirement?

What are the Instruments Available for Building a Retirement Corpus?

What is a Retirement Plan - What are its Features?

Embracing the FIRE Movement: Financial Independence and Early Retirement

Types of Pension Plans and Their Tax Benefits

14 Tips to Ensure Successful Retirement Planning

What Are Superannuation Benefits?

Right Age for Retirement Planning and How to Go About It

Benefits of Annuity Plan Investment

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

How to Protect Your Retirement Account from Hackers

7 Secrets that can Make Your Post-Retirement Phase Prosperous

Retirement: A New Start to Life!

What Retirement Would Look Like 30 Years From Now

Early Retirement Planning Tips

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

How Does NPS Work?

Plan Your Retirement in India - Retirement Calculator

Is ULIP Better Than FD?

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

NPS for Housewife

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

What tax benefits are there on saving for retirement?

Inflation: A Key Factor to Consider into Retirement Planning

What Is A 401(k) Retirement Plan?: A Beginner's Guide

Which Pension Plan Suits You best?

5 Best Investment Options for Senior Citizens in India

What Are Mortality Charges In ULIP?

7 Best Guaranteed Income Plans 2023 in India Their Eligibility, Features & Benefits

Importance of Retirement Planning

Top 3 Reasons Why You Should Start Retirement Planning Early

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

The Significance of Number 8,000 in Retirement Planning

How Has NPS Performed in Comparison with Other Instruments?

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

Turbocharge Your Retirement Savings with Annuities: Unlock Greater Returns

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

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

6 investment options for the retired

Do Pension Plans Allow Any Death Benefits?

What are the Charges Levied on ULIP?

Gift Your Parents a Sound Retirement Plan

How to Win at Retirement Savings?

Why is it Good to Have a Retirement Plan Before Your Marriage?

Benefits of Early Retirement Planning in India

Importance of financial Planning for Retirement

Different Types of Retirement Schemes

Here's Retirement Planning Guide for Working Men & Women

Meaning of Sum Assured in a ULIP

What are the Benefits of ULIP - Explained

Understanding Annuity Plans

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

How to Calculate Your Retirement Corpus?

Benefits of Early Retirement Planning

Tips to invest your voluntary retirement scheme money

Retirement Planning for Millennials

Changing Jobs? Reinvest Your Retirement Funds

How Do Annuity Options Work In NPS

Turbocharge Your Retirement Savings with Annuities: Unlock Greater Returns

Which are the Best Investment Plans for Indian Senior Citizens in 2022?

The Rise of ESG Investing in Retirement Planning

Ten Signs That You're Ready to Retire

Retirement Planning: Use our Retirement Calculator to Plan Ahead

Here's Benefits of Post Retirement Investment Options

Retiring soon? Here’s why buying annuity plans may make sense

Is an Annuity a Good Investment Option?

15 Passive Income Ideas for Seniors to Boost Retirement Income

Demystifying Retirement Financial Planning

How Can NPS Help You Save Tax?

How to Maximize Your Retirement Savings with a Pension Scheme in India

Reasons you should Buy a Retirement & Pension Plan

How to Save for Retirement With Retirement Investment Plans?

What are the Rules for Exit From NPS?

3 Ways to Save Early to Keep Living Out Your Dreams Post Retirement

Mastering the 30:30:30:10 Rule: A Guide to Effective Retirement Planning

Here's are Advantages of Pension Schemes and Retirement Plans

4 Tips to Avoid Running Out of Money in Retirement

Terminologies You Should Understand About Retirement Plans

Which Is Better: ULIP or SIP?

Types of Retirement Plans

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

What is a Defined Benefit Plan and How it Works?

How Does ULIP Work in India?

How to Register An EPF Grievance Online

What Are Retirement Pension Plans?

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

Know the Pros and Cons of Retirement Annuities

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

A Quick Guide to Retirement Plans

Types of Pension Plans for Your Retirement

Retirement Planning at 50? You Are Still Good to Go

How To Check EPF Claim Status- The Complete Process

Important Questions To Ask Yourself Before Choosing A Good Retirement Plan

Mistakes You Must Avoid While Planning Retirement

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

How should one decide on fund allocation within NPS?

What is the Minimum Lock-in Period for ULIP?

What are the Differences Between ELSS ULIP and Mutual Funds?

Retirement planning with a systematic life insurance plan

Managing Your Money After You Retire

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

Guide to Long Term Investment