Savings plans come with various features that help individuals meet their specific financial needs by making informed investments. A savings plan offers insurance coverage and does this as per its members’ risk appetite and suitability. Along with the benefit of wealth accumulation, it also offers a death benefit given to the beneficiary of the policy in case there has been an unfortunate demise of insured, during the policy tenure.
In this article, we will discuss with you all the features of a savings plan that you must know. Let us first understand what a savings plan is.
What is a Savings Plan?
A savings plan offers a flexible pricing model that helps meet people’s specific financial needs by making investment decisions based on the person’s risk appetite and suitability.
With the benefits of accumulating wealth, a savings plan offers another advantage of insurance coverage. Also, under the savings plan, death benefits are paid to the beneficiaries of the plan in case of the unforeseen demise of the insured person during the tenure.
These plans are introduced by the Indian government or financial institutions such as public sector banks. These savings schemes are backed by the Indian government and thus cater to the interested capital while also providing complete security. For example, a retirement savings plan is calculated using a retirement savings calculator.
Features of Savings Plan you Must Know
For a secure and seamless future to achieve all goals of education, repayment of loans, buying a house or car, marriage, etc. Investing in a savings plan is one of the ideal ways to pave a roadmap for your future.
There are features of savings plan you must know:
Investing in a savings plan can help secure financial stability for you and your loved ones. There can be uncertain situations and times when the death of the sole earning member of the family occurs. In such a case, if you are the family’s breadwinner, savings plans can provide monetary backup to you and your family, even when you’re not present.
An insurance plan provides fixed, guaranteed returns. Therefore, there is no need for you to worry about security regarding your finances, and you can be at peace.
Another feature of a savings plan is that it provides excellent tax benefits. Under the Income Tax Act, premiums that are paid are deducted from your income, which is taxable. However, it is essential to remember that tax laws are subject to change now and then.
Under a savings plan, maturity benefits are specific and offer fixed savings to the policyholder. Additionally, maturity benefits are available in a savings plan that helps policyholders achieve their desired financial goals.
Flexibility in the mode of payments
Investing in a savings plan provides you with the flexibility of choosing the frequency with which you pay your premiums. Depending on your feasibility and comfort, the premiums can be paid monthly, quarterly, or even annually.
Added on rider benefits
The majority of savings plans include additional rider benefits. Rather than buying a new insurance policy, you can easily avail of these added benefits such as critical health, accidental death, etc. These can help you secure yourself financially and assist you in getting full coverage. Also, you must note that these are not mandatory. However, they are available at an additional cost.
The tenure of the policy
A savings policy helps you customize the tenure of the policy at the time you purchase it according to your needs and those of your family.
The features mentioned above help you get complete information on how a savings plan is ideal for making investments. Also, it helps you know how it is a conclusive policy for your financial security and that of your family. Savings can be highly beneficial by providing tax, retirement, and financial protection benefits.