Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term

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

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.

Things to Know Before Buying an Endowment Plan

An endowment plan is a savings plan that offers you the opportunity to save and grow your money to provide financially secure coverage to you and your family members.

  • Jul 06, 2022
  • 3,996 Views

“Save money, and money will save you”

Savings and investing can sound the same, with one single difference. You save a small amount every month. It is saved, but it does not grow. Investing your savings will help you grow your money. It is incredibly crucial to keep aside a part of your earnings to meet uncertain future requirements.

Furthermore, setting aside a part of your income will help to give you the financial freedom to fulfill all your needs. An endowment plan is one such saving plan that offers you the opportunity to save and grow your money to provide financially secure coverage to you and your family members.

What is an Endowment Plan?

An endowment plan is a life insurance plan that, apart from offering life coverage to the insured, helps the policyholder save regularly over a specific time to get a lump sum amount whenever the policy matures. This maturity amount can meet various financial needs like funding one’s retirement, children’s education and marriage or buying a house. Also, the total amount is paid to their beneficiaries in case of the policyholder’s demise. Therefore, it is a life insurance plan with a saving component and a lump sum maturity benefit.

Features of Endowment Policy

Endowment plans provide a disciplined route for savings. Salaried people, small business people and professionals should look for this savings plan to meet their long-term financial security goals. Also, risk-averse individuals who do not mind settling for a lesser return than taking additional risks should go for an endowment plan.

Below mentioned are some of the features of an endowment life insurance policy:

Life Cover

In case of the sudden demise of the policyholder, the beneficiaries stay financially secure under the endowment plan as they are paid the sum assured amount. Thus this plan offers death benefits to the nominee.

Maturity Benefits

This plan’s unique feature is that it benefits the policyholder on the plan’s maturity. Then, on the completion of the tenure, the policyholder gets the sum assured along with the maturity benefit.

Premium Payment

Endowment policy offers flexible premium benefits to the policyholder. They can select the premium amount at their convenience. They can either opt for a monthly, half-yearly, or annual premium payment mode or even choose to pay the entire amount simultaneously.

Tax Benefits

Under Section 80C of the Income Tax Act, 1961, the endowment policyholder can claim deductions of an amount up to ₹1.5 lakh for premiums paid in a financial year.

Who Should Buy an Endowment Plan?

An endowment plan can help build up a corpus amount through disciplined savings. Therefore, this amount can be used to meet long-term financial goals or any unexpected emergencies. In addition, you can use these savings for buying real estate, saving for your child’s education, or providing financial coverage to your family after you. Hence, this plan benefits those looking for intelligent saving methods to ensure financial security.

Reasons to Buy an Endowment Plan

Now that you know what an endowment plan is and the features of an endowment policy, let’s move forward to understand the reasons behind buying an endowment plan. Keep scrolling through to know the details:

  • An endowment plan is required to safeguard your loved ones against economic hardship after an unfortunate event.
  • It helps the policyholder create a corpus to meet the life goals through regular savings.
  • Also, this plan helps the policyholder by offering the tax deduction benefits per the prevailing tax laws.

All these reasons make an endowment plan worth purchasing.

Conclusion

If you are looking for goal-based savings or a plan to ensure security for your family, then you should invest in an endowment plan as soon as possible. Early investing helps ensure that your premium amount is not too high, and you can save a considerable amount. With the benefit of offering financial security to your family against life’s uncertainty and creating a corpus saving for the future, an endowment plan is considered the intelligent buy to achieve your financial targets.

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

Kotak e-Invest

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

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Corporate Bonds: Meaning, Types & Benefits

What are the Best Investment Options for Beginners or Amateur Investors in India?

How Do One-Time Investment Plans Work?

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

How To Diversify Portfolio In 2022?

How to Calculate Your ULIP Returns?

Four Financial Lessons from The Vedas on Living Life to The Fullest

Planning Financial Goals and Objectives of Financial Planning

What is Direct Investment and its Types?

Top 10 Investment Strategies to Create Wealth

Which is a Better Investment - Mutual Funds Or ULIP?

ULIP as an Investment for Your Child

ULIP Plan as a Gift

What is Compound Interest, And How Do I Calculate it?

How to Increase Net Worth Along with Family Protection

Are Investment Returns Guaranteed in a ULIP?

Investment Options for NRIs in India

ULIP Capital Gain Tax: Check Tax Norms for Capital Gain on ULIPs

Do You Know the Difference Between Savings and Investment?

4 Benefits of ULIP Fund-Switching Feature

Top 10 Investment Plans Available in India

Why ULIP is Better Investment for Long-Term Wealth Creation?

What is Fund Switch in ULIP? And ULIP Fund Switching Techniques

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

6 Important Tips to Maximize Your Gains with ULIP Investments

Importance of Portfolio Management

How is the Compound Annual Growth Rate (CAGR) Calculated in ULIP?

Best Investment Options to Cover Your Child's Education

What is the Importance of Saving Money?

Why is Portfolio Diversification Important? How to Diversify Your Portfolio?

How to Use Recurring Investment Strategies to Build Wealth?

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

What are the Best Investment Options for Young Adults?

What are Tax-Deferred Savings Plans?

ULIP vs FD - Which is Better and Why?

Best Investment Options in India in 2022

How to Start Saving Money in 10 Simple Ways?

Asset Allocations in ULIP - Know the Top Benefits

What are the Best Short-Term Investment Plans with High Returns?

Difference Between Passive and Active Investing

What are the Best Investment Options for Students in India?

What is Money Management? Definition & Example

Top 5 Principles That Need to be Followed for Wealth Creation

What's Better for Your Child's Education? Child Plans or Mutual Funds?

Difference Between Guaranteed Savings Plan and ULIP

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

Which is Better – FD, Mutual Fund, SIP, or ULIP?

Learn About Safe Investments with High Returns in India

Are Money Back Policies Helpful? A Complete Guide

Best Investment Plans for Children - Secure Your Child's Future

How to Plan Savings from Salary?

How to Cancel ULIP Policy?

Can ULIP Help in Achieving Short-Term Financial Goals?

Successful Financial Planning for Urban Women

ULIPs Investment – A Boon or Bane?

Investments Options to Buy a house in India

Best One-Time Investment Plans in India

What is ULIP Plan, and How Does it Work?

What is a Savings Plan and What are is Benefits?

Learn About Safe Investments with High Returns in India

Customising investments to manage your wealth

Why Should I Invest in ULIP?

Why Do You Need A ULIP Plan - All You Need To Know

How to Make Your Financial Portfolio?

What are Mutual Funds?

Long Term Savings Plan - Best Savings Investment Plans in India

Debt ULIPs vs. Debt Mutual Funds: What's the Difference?

Important Questions You Must Ask Yourself When Buying a ULIP Plan

8 Important Tips to Maximize Gains with ULIP Investments

The lesser-known facts about ULIP policy that customers should be aware of?

Are Gains from ULIP Sale Taxable?

Why are ULIPs One of the Best Tax Saving Instruments?

How to Manage Your Portfolio Like a Professional?

ULIP NAV Meaning & How is the Return Calculated in ULIP

Got a Salary Hike? Here’s How to Plan your investment further

What is ULIP Renewal?

How Can ELSS Funds Help You Save Tax & Create Wealth?

How to Fulfil Your Financial Goals in the Next 10 Years?

Top 5 Investment Options in 2022 for Healthy Returns

How to Plan Your Child's Education - A Step-by-Step Guide

Benefits of ULIP as a Child Insurance Plan

Which are the Best ULIP Plans in India for Children?

Creating a second source of income with life insurance

Best Guaranteed Returns Investment Options to Meet your Financial Goals

Different Types of Endowment Plans

Savings Plan for Grandchildren

Why Should You Build an Emergency Fund?

Why Should You Consider Guaranteed Savings Plan for Long-Term Investment?

What is SIP Calculator, And How Does it Work?

Does Rupee Cost Averaging Work In Unit-Linked Insurance Plans?

How Does an Endowment Plan Work?

Endowment Plan vs Fixed Deposit?

What are Index Funds and How Do They Work

What is Equity Mutual Funds: Meaning, Types & Benefits

What are Some of the Safest Investment Options in India?

Why Should You Invest in Term Insurance And ULIP?

Early Investing and the Power of Compounding

What are Financial Assets & their types?

Building wealth through regular investing

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Planning for Your Child's Higher Education? Explore These Investment Options

How Much Wealth Can You Create from ULIP in 10 years?

Why Are ULIPs Called Flexible Investments?

What are loyalty additions, and how do they work in a ULIP?

Can ULIP Policy be Transferred?

Beginner's Guide to Wealth Creation: Meaning, Strategies, & Importance

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

How to Manage Inheritance Money?

ULIP Benefits You Can Avail from Early Investing

Rate of Interest on Different Investment Plans in India

How to Plan your Investment to Achieve Periodic Financial Goals?

Short Term and Long Term ULIP Plans for Wealth Creation

Factors Affecting Stock Markets

What is the Time Value of Money (TVM)?

Safe Investment Options with High Returns for FY 2018-19

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

यूलिप के फायदे (Benefits of ULIP in Hindi)

How To Invest Money In ULIP?

How Can a Legal Nominee Claim ULIP Benefits are the Policyholder’s Death?

Why Should Parents Invest in Endowment Plan?

How To Track ULIP Performance?

What is a Child Money Back Plan, and How Does it Work?

What is a Credit Score and How Can Insurance Help You Improve it?

Is This The Right Time To Invest In ULIP? Why or Why Not?

What is ULIP and Its Benefits?

What are the Best Investment Options For Females?

Receiving regular payouts at various stages of life