Picking The Right Savings Plan: A Checklist

Introduction

Rishabh and Rahul were two good friends who graduated together and then later worked in the same company. Rishabh was an extravagant person as he belonged to a business family. He never thought of the future and savings. Rahul on the other hand lived with the complete sense of security and was wary that he needed to save money for unexpected expenses in future. Rishabh’s family lost their funds in the business which shook him because he barely had enough money to support his family. Rahul, on the other hand, had bought a savings plan being wise. 

Life is unpredictable and it can take any turn leaving you appalled. This is why savings is important in life which can help you manage the unexpected financial crises. More importantly, the savings gives your family the confidence to face the odds in life.

Now that you have understood that savings is important, the next part to comprehend is that buying a savings plan is the safest option to consider.

Let us next look at the needs of the savings plan.

Table of Contents.

What is the need for a Saving Plan?

Types of saving plans

How to choose a saving plan? Checklist

Conclusion

What is the need for a Savings Plan?

Savings plan is also called an endowment plan that provides you both the life cover and the option of savings. The insurance component of the savings plan provides death benefit to the nominee if the life insured passes away during the policy tenure. Other than the insurance protection, the savings plan allows you to save money over a long period of time. The accumulated fund can be used to handle the financial hurdles or obstacles in life.

You may need a savings plan for:

1. For peace of mind: With the savings plan, you can accumulate funds for the time of need. When regularly keeping aside money, you can be at peace that you have financial backing always.
2. For a financially secured future:The needs may vary as you or your family grow old. The requirement of money will never fade or deteriorate. This is why having savings is always helpful especially when it is about  unexpected expenses. You may wish to buy your own house and accumulate funds for life after retirement. All of this won’t be possible in a day if you are a salaried person and do not have your savings.
3. Support your child’s education: Like you, your child can dream of getting higher education. You would always want to support your child’s dream even if your current capacity is not to. This makes another relevant factor to plan for a saving or endowment plan. 
4. Save for your child’s marriage: Having a destination wedding is everyone’s dream. You may also aspire to get your child married at a beautiful location.
   buy Tadalafil generic buynoprescriptiononlinerxx.net over the counter
   
   If that is true, you can save for it in a disciplinary manner through an endowment plan.
5. Save for travel or fun: For monthly salaried individuals it gets hard to save regularly if they wish to travel to new places. This makes savings for short-term goals all the more meaningful as then you can travel comfortably.

If the idea behind the savings is clear to you, let us now look at the types of savings plan.

Types of Endowment Plan

These are the types of the endowment plans you can think of buying.

1. Full-endowment plans:

Full-endowment plans are insurance plans that guarantee you a certain amount at the end of the policy period with profit. The entire amount is payable to the nominee if the life insured passes away during the policy period. Under the full-endowment plans, the insurance company may also provide the incentives that make the maturity benefit more than the sum assured.

2. Low-cost endowment plan:

The low-cost endowment plan is the insurance policy that allows you to save funds for the specific time range. The premium for this insurance plan is lesser in comparison to other policies.

3. Unitised with-profit endowment plan:

This type of endowment plan combines the ULIP’s earning potential with the guaranteed returns. The plan assures a guaranteed return which dilutes the impact of the market swings. 

4. Non-profit endowment plan:

This type of endowment plan pays a lump sum payment either to the nominee in case of any catastrophic event or at maturity. There are no bonuses declared with the plans hence the amount does not change much.

5. Unit-linked endowment plan:

Under the ULIP endowment plan, the returns can be expected higher but the risk is also involved. The premium is invested partially in the market funds and a portion is given towards the life cover. The returns will be driven by the market risks.

How to choose a saving plan? Checklist

When you are determined to save money for your future using the savings plan, it is best that you choose the best policy for yourself. Here is a check-list of what you should do before buying a savings plan:

1. Check for the returns: Under the savings plan, the returns expected should be guaranteed. It is going to be a long-term investment under the savings plan hence keeping the investment safe is also important. Avoid buying equity-linked savings plans if you are not a risk taker. You can pick a plan that gives you guaranteed returns as they come with annual and loyalty bonuses.
2. Plan that protects your financial goals: The intent of the savings plan is to help you protect financial goals like your child’s education or daughter’s marriage. It is important that these goals are guaranteed. Buy the plan that guarantees the financial goals for you.
3. Try a plan with flexible investment terms: Try a plan that allows you for a flexible investment term. Also, the plan should offer you a comfort to invest for a short period to complete one goal and then quickly move to another goal.
   buy plavix generic buywithoutprescriptionrxonline.com/plavix.html over the counter
   
   
4. Savings plan that saves you tax: Savings plan premium that you pay in a year is eligible for tax deduction in a financial year. The maximum deductions that are allowed in a year is equal to Rs.1.5 lakhs under Section 80C of Income Tax Act.
5. Online or Offline: Before buying the plan, it is a must nowadays that you check whether the plan is available online or not. If yes, then it will be great for you to conveniently explore the features of the plan. Buying an endowment plan online will save you money as the premium is comparatively lesser than what you pay for offline policy.
6. Evaluate your risk and return ratio: Buying a savings plan is easy but much before that it is important to evaluate your risk and return ratio. It is crucial to know whether you will be able to bear the premium expenses or not. If yes, then gauging the quantum of return of the savings plan is the next thing to follow.

Best Savings Plan in India.

A life insurance policy is to secure the future of the family when the time is unfavourable. If you are planning to buy a savings plan in India, these are the suitable options for you:

1. ABSLI Assured Income Plus: 

• ABSLI Assured Income Plus is a plan to invest for a short-term and get guaranteed returns for a long term. 
• The plan provides long term regular income and fetches you tax benefits. 
• You can buy this plan online.

2. ABSLI Assured Savings Plan: 

• The insurance policy provides life cover and the benefits of savings to safeguard your family. 
• The plan provides guaranteed benefits on death or maturity. 
• You also get loyalty additions that enhance your maturity corpus year on year. 
• The policy gets multiple policy and premium payment options.
• You can buy the policy online from here.

Conclusion:

Savings is a dream to some while a reality to those who know how to save. Keeping aside the money from your monthly income can be a little difficult for everyone. It limits your expenditures and does not offer any life security. But if you save money through an endowment plan, you get life cover as well as an option of savings. For more details on how to buy a savings plan and when to start savings, you can read here.