Difference Between Guaranteed Savings Plan and Guaranteed Income Plan
Close
Close

Buy a life insurance plan in a few clicks

Now you can buy life insurance plans completely online right here.

  • Icon for Kotak Preferred e-Term Plan

    Kotak e-Term Plan

    Kotak e-Term Plan is a pure term plan that provides a high level of protection to your loved ones in your absence.

  • Kotak E-Invest Plan

    Kotak e-Invest is a comprehensive Unit Linked Life Insurance Plan that can be customized as per your goals and needs - be it protection; investment; financial security for child or retirement planning.

  • Icon for Kotak Guaranteed Savings Plan

    Kotak Guaranteed Savings Plan

    Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and insurance cover against any eventuality.

  • Icon for Kotak Preferred e-Term Plan

    Kotak Lifetime Income Plan

    Kotak Lifetime Income Plan gives you the assurance of your income continuing throughout your life and in your absence throughout the lifetime of your spouse!

  • Icon for Kotak Preferred e-Term Plan

    Kotak Health Shield

    The Kotak Health Shield Plan helps secure your finances in times of sudden medical expenses related to illness such as Cardiac, Liver, Neuro and Cancer (all early and major stages of illness /conditions of Cancer); along with offering protection for Personal Accident - in case of accidental death or disability.

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.

Back

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

BUY ULIP PLAN NOW
  • 26th Apr 2022
  • 2,644

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

As our lives get modernized with the growth of technologies, so do our requirements and needs. However, to ensure that we keep up the pace and update ourselves at the rate of the world around us, we need to be financially stable. Financial stability is not just about having enough in your account to sustain yourself. For many people, financial stability means having enough in the banks for a fulfilling and modern life. Now, to achieve financial stability, investment is a key process. But, the question here is where to invest to achieve stable financial growth and, at the same time, meet the requirements of our modern lives?

It is well known to us that modern problems need modern solutions. This fact highly influences even the financial world. So, it brought modern solutions for investment in the forms of Guaranteed Savings Plan and Guaranteed Income Plan.

This article will discuss the Guaranteed Savings Plan and Guaranteed Income Plan and tell you about the difference between Guaranteed Savings Plan and Guaranteed Income Plan. Once you understand the key points of the guaranteed savings plan vs guaranteed income plan, you will know which one is the best fit for you and your long-term goals.

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

What is a Guaranteed Savings Plan?

Straightforwardly, Guaranteed Savings Plan, also known as GSP, is a non-participating non-linked endowment life insurance plan. Too technical, right? Let us make it simpler for you.

GSPs are generally non-participating plans that have no role for the policyholder in investment matters, and the insurance company manages the whole fund. Additionally, GSPs also offer an endowment assurance at a fixed amount. As per the terms of GSP, you have to pay the premiums for a fixed tenure, and once the plan achieves maturity, you are entitled to its benefits. In addition to the fixed annual rate of interest component, these benefits also include advantages such as maturity bonuses and loyalty rewards, depending on the insurer.

What is a Guaranteed Income Plan?

A Guaranteed Income Plan (GIP), also known as Assured Income Plan, is a savings-cum protection plan. Many would say that it is a traditional plan. However, this plan follows traditional investment techniques in a modern way. This plan is also a dual benefit plan. Unlike ULIP plans, they do not offer short-term maturity. These are non-participating and do not allow you to participate in the investment strategy.

GIPs are investment tools that help you save money while providing a life cover for 30 long years. This gives you financial protection for you and your family from uncertainties and your absence.

In simple terms, GIPS are traditional non -participating insurance plans with a modern investment approach that offer maturity and death benefits. They have a very long maturity period and serve as a 2nd source of income post-retirement and your pension amount to help you meet the post-retirement requirement.

So, both the Savings Plan and Guaranteed Income Plan are a great choice for long-term financial stability. First, however, you must understand the difference between both of them.

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

Parameters

Guaranteed Savings Plan

Guaranteed Income Plan

Premiums

Annually or Installments

Annually or Installments

Policy Term

Min: 7 Years

Max: 10 Years

Min: 10 years

max: 30 years

Maturity Benefits

Guaranteed maturity benefit + Guaranteed additions

Assured income payout + lump sum benefit at the end of policy term

Taxability

Upto ₹1,50,000/- deducted under 80C per annum

Upto ₹1,00,000/- deducted under 80C per annum

Loan benefits

Yes, maximum up to 80% of the prevailing surrender value

Not available

Opting either of these plans depends on your financial goal and you must ensure that you don’t miss out on the premiums to avail maximum benefits from these plans.

- A Consumer Education Initiative series by Kotak Life

Also read

  • Top 5 Principles That Need to be Followed for Wealth Creation

    If your aim for wealth creation this year, you need to follow a disciplined investment approach. Building wealth is a long-term activity. Here are 5 w...

    Read more
  • How To Diversify Portfolio In 2022?

    Diversification of invest is as important as savings and investment. Here are a couple portfolio diversification options that help you in increasing y...

    Read more
  • How is CAGR Calculated in ULIP?

    A Compound Annual Growth Rate (CAGR) calculator is useful for calculating the compound annual growth rate in ULIP of your investment over time.

    Read more

Related Plans

  • Kotak Group Shield

    Kotak Group Shield

    Kotak Group Shield Plan covers your customers' loans and savings and protects the well-being of your customers and their family members in the event o...

    Know more
  • Kotak Assured Income Accelerator

    Kotak Assured Income Accelerator

    Kotak Assured Income Accelerator ensures that you get Guaranteed Income every year on the same amount of savings and that the Guaranteed Income increa...

    Know more
  • Kotak e-Term Plan

    Kotak e-Term Plan

    Kotak e-Term Plan is a pure term insurance plan that provides a holistic life protection at affordable prices. Find out the eligibility criteria, key ...

    Know more
  • Kotak Group Secure Capital Plan

    Kotak Group Secure Capital Plan

    Kotak Group Secure Capital Plan is a Non-Participating, Guaranteed Unit Linked Fund Based Group Life Insurance Plan. It enables Employers /Trusts to m...

    Know more