The Immediate Annuity Plan is designed to help you maintain your choice of lifestyle post retirement. It helps you cope with your healthcare costs and stay ahead of inflation.
REASONS TO BUY INDIAFIRST IMMEDIATE ANNUITY PLAN
Empowers you to choose your retirement age, between 40 and 80 years
Enjoy complete financial independence by receiving a definite regular monthly/ quarterly/ half-yearly/ yearly income throughout your years of retirement
There are 4 different annuity options to choose from life annuity, life annuity with return of purchase price, joint life last survivor annuity for life and annuity certain for a period of 5 years/ 10 years/ 15 years
Choose the joint life option to support your spouse through annuity proceeds, even in your absence
Choose return of purchase price option to protect your nominees as they can get back the investment amount
Enjoy a comfortable retirement for a defined time, under the option of annuity certain for a period and life thereafter
Existing individual, deferred and group deferred annuity policyholder/ member/ beneficiaries can avail the benefits of the plan anytime between 0 to 99 years
WHAT ARE THE ELIGIBILITY CRITERIA?
Minimum age for application (first annuitant) is 40 years for new members; 0 years for existing pension members/beneficiaries of IndiaFirst Life Insurance
Minimum age for application (second annuitant) is 18 years
Maximum age for application (first/second annuitant) is 80 years
Minimum premium is Rs. 3,00,000 while maximum premium is limitless
Minimum annuity installment per month is Rs 1000 and for a year is Rs 12,500
Annuity installment frequency is monthly, quarterly, half-yearly, and annually
IndiaFirst Immediate Annuity Plan
After working hard for your peace of mind and security all your life, retiring from work and responsibilities sounds like a dream. It is essential to ensure that this dream does not turn into a nightmare. Retirement planning can help you transform your old age into your golden years. By choosing the right retirement plans in India, you can do your bit to stay ahead of inflation, plan for your healthcare needs, and maintain your standard of living without compromises.
With the IndiaFirst Immediate Annuity Plan, you have complete control over your future, irrespective of your increasing age. By opting for the IndiaFirst Immediate Annuity Plan, you are opting for peace of mind, financial security, and a life cover to protect your family's needs in the case of your passing.
Earn a guaranteed income paid out to you at regular intervals during your retirement—begin the golden days of your life with the certainty that you have planned for your needs in advance.
What are pension plans?
Retirement planning is an important component of everyone's life-plan. Considering the rate at which inflation is growing and the possibility of a long life due to medical advancements, retirement planning becomes a pivotal task necessary to secure your financial future. To this end, there are many reputed pension plans in India that are designed to help you meet your retirement needs.
Pension plans are retirement benefit plans that offer you the dual benefit of insurance life cover and investment. Typical pension insurance plans involve saving money at a steady pace for a chosen number of years. This corpus is made bigger and better, thanks to the power of compounding interest. When you reach your age of retirement, and your professional income ceases, an annuity pension plan ensures a steady flow of income when you need it the most.
A retirement policy in India has two stages—accumulation and vesting. During the accumulation stage, the policy holder pays periodic premiums to build a substantial corpus of funds until they retire. Upon retirement, you can choose to begin the second stage, i.e., vesting. This refers to the age at which you start receiving the retirement benefits of the plan. Your insured retirement plan offers you a guaranteed amount that hits your account periodically when you are no longer earning a fixed salary during vesting. With a pension insurance policy, you can also bank on getting traditional life cover that will protect your family's financial needs in case of your untimely death.
There are different types of retirement pension schemes and pension plans in India. The perfect retirement policy for you is the one that offers you the kind of financial help you are looking for after retirement. Some of the common types include:
- Deferred annuity plans: You can pay a single premium or periodic payments during the premium payment term. After this term ends, your vesting period starts at a time of your choosing.
- Immediate annuity plans: This is a single premium policy. In immediate pension plans, you make a single lump sum payment to begin the retirement policy, and your regular pension payments start immediately.
Why should you opt for pension plans?
Living a long life is not as important as living a long and happy life. Today, when you have a need, you also have the wherewithal to fulfil that need because you have a regular income. However, post-retirement, you may not have the financial capacity to satisfy new requirements and meet unforeseen circumstances. This is where a pension plan comes in. By planning today for what you will need tomorrow, you can ensure that your life quality does not deteriorate just because you no longer have a professional income. There are many reasons why you need a pension plan.
To meet medical emergencies
Even if you lead a healthy life, old age brings its own maladies with it. Along with health concerns, you will also have to contend with medical expenses. This can be difficult if you are retired and have no income. A good retirement policy is all you need to ensure that your medical concerns are taken care of without breaking the bank.
To combat inflation
Two decades ago, Rs. 50 boasted substantial purchasing power. Today, the same amount has reduced much in value. Inflation or price rise is a universal truth that needs to be combatted in advance if you want to enjoy a peaceful post-retirement life. Even though you may not be planning any large expenses in your golden years, you still have to purchase essentials, medication, groceries, and pay your bills. A sound pension insurance plan will help you anticipate what you will need in the future and make provisions for it.
To ease the burden on your children
There was a time when large, joint families were the norm. Older people could bank on the moral and financial support of multiple family members. Today, nuclear families have become the norm, and it is rare to see more than three children in one household. A few decades down the line, you may not have the support you need as a senior citizen.
Instead of spreading your expenses amongst multiple family members, all the burden of your care and upkeep will fall on your children. This may cause them to divert their finances away from their dreams and towards your expenses. An annuity pension plan can help you live your retired years as you want to, without depending on anyone else for your needs.
To be independent in your golden years
As a breadwinner, you are used to being a decision-maker who does not need others to step in and rescue the situation. There is no reason why this should change when you grow older. Whether you need to buy medications or a new pair of spectacles for yourself or your spouse, a retirement policy affords you the independence that you have always enjoyed. Live your retired life with respect and dignity with a retirement benefit plan to support you.
What are the steps to retirement planning?
Retirement planning is not an arbitrary process wherein you pull numbers out of a hat. It is an empirical process wherein you factor in essential variables to arrive at a plan that fulfils your short-, medium-, and long-term financial goals. This is an excellent step-by-step approach to retirement planning:
Step 1: Financial goal-setting
It is not enough to say that you want to be comfortable during your retirement years. How much would it take for you to be satisfied? Factor in inflation to arrive at a realistic amount of money you would need to take care of your needs during your retirement. This step is all about identifying your financial needs and constraints and setting your retirement goals.
Step 2: Knowing your current situation
Analyse your present financial situation. Are there debts that need to be paid, liabilities to be factored in, and specific future expenses to plan for? Make provision for these payments to arrive at how much you have left with you to invest in pension plans in India.
Step 3: Examine your risk-appetite
Investment-cum-insurance pension plans invest your money for you. Where the money is invested depends entirely on your risk profile. If you are at a place where you are comfortable taking a few risks, choose pension plans that invest in equity. However, if you are risk-averse, then debt investment pension plans or those that invest in government securities and bonds are a much better bet for you.
Step 4: Allocation of funds
Earmark a specific amount for retirement planning. With single premium immediate annuity pension plans in India, you can put aside a significant sum at one go and enjoy guaranteed monthly pension benefits immediately after that. Some periodic premium pension plans offer a deferred annuity option so you can decide your vesting age as per your needs. Along with pension plans, you may also choose to invest in other financial instruments as a part of your retirement planning—allocate funds accordingly.
Step 5: Monitoring and reassessing
Nothing is set in stone. Whether it is your financial goals or personal preferences, it is important to go back to the base periodically to monitor progress and reassess the efficacy of the solution you have chosen.
When should you start planning for retirement?
There is no right time to retire. You could choose to work till you are well into your 60s, or stop when you touch 40 years of age. You get to decide when you would like to retire. With the right retirement planning, you can ensure that your retirement does not impact your financial stability. To do this, you have to start retirement planning as early as possible. The creation of wealth is not a short-term process. The earlier you begin creating wealth, the more time your investments get to multiply and reap benefits for you.
By starting early, you get the best of all worlds—longevity risk is easily managed, compounding interest gets time to reap dividends, and aggressive investment is possible.
While there are advantages to starting early, what if you have missed that window? Can you still plan for your retirement? Yes. Starting late may make the process a little more complicated, and the gains you get may not be maximized, but it is still a worthy process. With immediate annuity pension plans, you can pay a single premium and begin enjoying pension income immediately. If you are starting late, choose investment instruments that offer you higher returns, cut down your overall expenses, see if you can pool in your income with that of your spouse, look for other income generation sources, and start now.
What are the factors to consider while choosing pension plans?
As time goes by, the life expectancy of people is continually increasing. In India, it is common for people to live till the ripe old age of 90-100 years. However, as life expectancy increases, it becomes vital to plan for the future and choose the right insurance plan for senior citizens in India. Retirement planning for your old age starts today. Invest in the best retirement annuity plans to ensure that you create a large enough corpus that will stand you in good stead irrespective of how long you live. Here are a few questions to ask while choosing between pension life insurance options.
When would you like to retire?
While the typical age of retirement in India is around 60 years of age, there is no reason why you cannot retire before that. As long as you have made provisions for an alternate stream of income for your retirement, you could choose to retire at 45 if that is what you want.
Would pension plans be helpful for you?
If you are a government employee, you will receive a fixed monthly pension after your retirement. Privately-employed folks can cash in on their leaves and take their gratuity payment, but there is no provision for a monthly pension. Whether or not you will receive a pension from your employee, an additional income stream can only be helpful.
How much income would you like to receive upon retirement?
The efficacy of the pension plans you choose is determined by how much money they can provide after your retirement. If your retirement policy does not net you enough in the form of a monthly income, you need to supplement it with other retirement insurance policies. Analyse your finances, project the monthly income you would like post-retirement, and factor in inflation. The amount you arrive at should be what your pension plans net you in the future.
What types of pension insurance would work for you?
When it comes to types of pension insurance, there is no shortage of options. The two basic types of pension insurance are deferred annuity and immediate annuity. A deferred annuity plan is a typical pension plan wherein a corpus is accumulated through premium payments for some years before the policy holder retires and the monthly pay-outs can start. An immediate annuity plan, such as the IndiaFirst Life Immediate Annuity Plan, is like a single premium retirement policy. A single lumpsum payment is required to kickstart immediate pay-outs from the pension plan.
What else can you do to bolster your retirement fund?
The right pension plans are the foundation of your retirement planning. To boost your retirement fund even further, consider diversifying your portfolio to include a PPF account, fixed deposits, Kisan Vikas Patra or other government schemes, and ULIPs, depending on your risk appetite.
What are the features of the IndiaFirst Immediate Annuity Plan?
The IndiaFirst Immediate Annuity Plan is a non-participating, non-linked, immediate annuity plan, which can be purchased by paying a lump sum amount. You get the choice to select your retirement age and get a fixed annuity on a monthly/quarterly/half-yearly/yearly basis as chosen by you for life.
As a non-participating pension plan, the IndiaFirst Immediate Annuity Plan is not impacted by volatile market-related fund values. This risk-averse retirement insurance policy is an immediate pension plan that offers you retirement annuity instantaneously instead of years later.
Key features of the IndiaFirst Immediate Annuity Plan
- You can choose your retirement age as per your need; you can reap the returns starting anytime between 40 and 80 years.
- You will receive a definite regular monthly/quarterly/half-yearly/yearly income through your years of retirement.
- Choose the Joint Life option to support your spouse through annuity proceeds even in your absence
- Want to protect your loved ones even when you are not around? Avail of the Return of Purchase Price option and protect your nominees as they get back the investment amount.
- Get a comfortable retirement for a defined time under the option Annuity Certain and life after that.
- Existing individual deferred and group deferred annuity policyholders/members/beneficiaries can benefit from the IndiaFirst Immediate Annuity Plan anytime between 0 to 99 years.
Pension annuity options under the IndiaFirst Immediate Annuity Plan
Under this single premium retirement policy, you have four different pension annuity options to choose from:
- Life Annuity
- Life Annuity with Return of Purchase Price
- Joint Life Last Survivor Annuity for Life
- Annuity Certain for a period of 5/10/15 years and life after that
In the case of a single life annuity, the pension annuity is paid for as long as you are alive. In case of a joint life annuity, the pension annuity is paid for as long as any one of the annuitants is alive, i.e., upon your death, your named spouse under the joint life will receive the annuity for as long as he/she is alive.
What are the eligibility criteria for IndiaFirst Immediate Annuity Plan?
- Under this immediate annuity plan insurance, the minimum age for application (first annuitant) is 40 years for new members; 0 years for existing pension members/beneficiaries of IndiaFirst Life Insurance
- The minimum age for application (second annuitant) is 18 years in this India First pension plan.
- The maximum age for application (first/second annuitant) is 80 years in this India First retirement plan.
- The minimum premium to be paid in this immediate annuity plan is Rs. 3,00,000, while the maximum premium is limitless.
- The minimum annuity instalment per month is Rs 1000 and for a year is Rs 12,500 under this India First life insurance pension plan.
- The annuity instalment frequency is monthly, quarterly, half-yearly, and annually under this retirement annuity plan.
What is a pension plan?
Pension plans offer dual retirement insurance benefits of life cover and investment. This enables you to build a corpus that will financially support you during your retirement. Typically, a partial sum can be withdrawn as a lump sum upon retirement. The rest of the amount is paid out as a regular monthly income or annuity.
You can choose the pay-out frequency—monthly, quarterly, half-yearly, or annually, depending on your policy options and personal preferences.
In the unfortunate event of the policy holder's death during the term covered in the retirement policy, the beneficiaries receive the sum assured defined when you chose to buy a pension plan. Pension plans secure your financial future and allow you to draw a regular income during your retirement years. They are a great tool to ensure your financial independence during your golden years.
What are the types of pension insurance I can opt for?
Based on the nature of the investment, types of pension insurance include those that are purely savings plans and those that are investment instruments.
You can also choose on the basis of annuity plans. An immediate annuity plan allows you to pay a single premium and get immediate pay-outs for the rest of your life. A deferred annuity plan enables you to build a corpus over a long period and defer the pay-outs such that they start on a chosen date in the future.
One of the types of pension insurance plans is the Joint Life annuity plan, which continues paying a pension amount to your spouse/partner for their whole life after the primary annuitant's death.
What is the right time to buy pension plan?
Everyone needs to do proper retirement planning in advance to ensure a secure financial future post-retirement. While you are still earning a regular income, you may feel like retirement is nothing to worry about. However, retirement planning factors in your current status, projections of how much you would require to live comfortably in the future, growing healthcare costs, inflation, and increasing lifespan.
The best time to buy pension plan is when you are young. Starting younger offers many retirement insurance benefits, and you can make the most of the power of compounding interest. Even if you have little to spare, it is best to start early. This does not mean that you should not start at all if you missed that window. Start where you are, with what you have. The second-best time to buy pension plan is now.
What are the benefits of a retirement policy?
Depending on the annuity insurance pension plans you have chosen, you would be privy to a number of benefits:
- Guaranteed income to ensure your financial independence after retirement
- A chance to ensure that your spouse receives a pension in case of your death
- The death benefit or sum assured for your family
- Flexible terms of premium payment
- The potential addition of riders
- Tax deductions and benefits under prevailing Income Tax laws
What is the difference between immediate and deferred annuity pension plans?
An immediate annuity plan is similar to a single premium insurance plan. You are required to make a single premium payment to kickstart the retirement pension plan and start receiving monthly pay-outs immediately. Deferred annuity pension plans need you to select a premium paying term during which you will make contributions towards the guaranteed pension plan. Under such a pension guaranteed plan, you get to defer the starting date of when you would like to receive pay-outs to a time in the future.
Can I have multiple pension plans?
Yes, you can buy retirement plans from private insurers as per your needs. However, you cannot buy multiple government-offered pension plans such as the National Pension Scheme.
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