The hotel you last stayed for vacation offered a complimentary meal. You were not aware of it and ordered food from the buffet. Nothing to scare but that dinner cost you more than Rs.5k. Too much after you had spent thousands on your vacation.
Same is the case that you wasted years in keeping aside money for the future but you did not make much returns. You were not aware of the savings plan that could have been an appropriate choice of securing your future financially.
If this excites you now, let us explore what is a savings plan?
Table of Contents
A little about Savings Plan
6 features of a Savings Plan
Benefits of a Savings Plan
A little about Savings Plan
Savings plan is also known as an endowment plan. It is an insurance policy that provides you both life cover and savings options. The endowment plan allows you to fulfil your goal of putting aside the money for future use. The insurance part of the savings plan pays the death benefit to the nominee when the life insured passes away.
These endowment plans are the systematic and a disciplined way to put aside the money every month. Let us now see the features of the savings plan that makes it lucrative to buy.
6 features of a Savings Plan
- Flexibility to choose life cover and policy term: The savings plan allows you to choose the flexibility of life cover amount. It also enables you to pick the policy term, that is, the length of time for which you want the cover.
- Lump Sum Amount Payable: When the policy premium amount is paid for the complete policy tenure, then at the maturity, the savings plan gives you a lump sum amount.
- Flexibility to choose the premium payment term: Under the savings plan, you have the flexibility to choose the premium payment term. You can pick short term goals, invest for some time and then free-up your time. To be precise, you do not have to get tied for a long term payment cycle until maturity.
- Cash value: these savings plans acquire a cash value. You can use the policy to apply for a loan whenever you fall short of money for your needs.
- Investment Option: Savings plan has an attractive feature of investment option. It provides the buyers an opportunity to put their money in anything ranging from equities to debt funds. The former is a high risk investment fund that can yield higher returns.
Additional Sum Assured Payable on Accidental Death is also covered under the endowment plan. It is another attractive feature to pay a sum assured in case there is an accidental death.
After reading the features of the savings plan, let us know about the benefits of the savings plan.
Benefits of the Savings Plan.
Looking for a secured future without worrying about the money and the rising expenses? The only thing that you can do is save some money so that you have financial security. The ideal way of keeping your money safe and yet be ready with money whenever you are in need is insurance.
Let us read the benefits of a Savings plan when the prime intent is to secure money for future:
- Life Cover: The savings plan comes with a life cover which implies that if in life anything happens to the life insured, the nominee will get a death benefit. The idea of buying a life insurance policy is to protect both the family from the unexpected losses as well prevent any draining of the savings.
- Huge Accumulated Funds: The funds you accumulate over the years for your family is another benefit of the savings plan. The insurance policy allows you to create funds that help you to attain future goals. The money saved via policy can be utilised to fulfil your dreams like buying a home, funding your child’s higher education, etc.
- Guaranteed Returns: The best savings plan in the market assures you of guaranteed returns.This makes it comfortable for you to decide when and for how long you can buy the policy.
- Wealth Boosters: The savings plan does not only provide you with the money you have kept aside. The insurance plan also guarantees wealth boosters announced by the insurance company. It enhances the value of the portfolio you own. These are the regular bonuses received when you are invested for a long period of time. The two kinds of wealth boosters that increase your maturity benefit include guaranteed annual bonuses and guaranteed loyalty additions.
- Reduced Paid-Up Benefit: If after paying the premium for 2 years, you are not able to pay the premium further, the insurance company will provide you a policy on the reduced paid-up benefit. The policy will not lapse.
- Auto Cover Continuation: Some insurance companies provide auto-cover continuation when you have paid premium for 2 long years, but are unable to do so further. As per the benefit, the full death benefit shall continue for two successive years.
- Tax Benefit: The premium payable under the savings plan is eligible for tax-deduction under Section 80C of Income Tax Act,1961. The maximum deduction allowed in one year is Rs.1.5 lakhs only.
Best Endowment Plans You Can Buy.
These are the best endowment plans that you can buy:
- ABSLI Assured Savings Plan:
The Assured Savings Plan provides you a guaranteed benefit on death and maturity. It further enhances the corpus with the loyalty additions every year. The insurance plan allows you to cover your spouse by choosing the Joint Life Protection Plan. You can apply for a free quote on the website.
- ABSLI Vision LifeIncome Plus Plan:
The Vision LifeIncome Plus Plan provides the benefit of comprehensive life insurance with maximum coverage up to age 100. The plan also comes with flexible benefit payouts which can be taken as cash-in- hand or can be added to the funds.
- ABSLI Savings Plan:
The ABSLI Savings Plan allows you to save regularly thereby increasing the savings steadily over years. You get guaranteed additions over the first 5 years, additional sum assured, and flexibility to choose life cover.
- ABSLI Income Assured Plan:
The Income Assured Plan helps you to save money and accomplish the rising needs at different stages of your life. The policy fetches you guaranteed returns.
Buying a savings plan is the safest option when you have to think of long-term investment and secured returns. The insurance policy makes you capable of saving money and achieving your goals. In the end, you get savings and additional bonuses at the time of maturity that provide financial support to boost your aim. The life cover of the savings plan benefits your family when the ultimate truth in life takes place. This is the final aim you have when it comes to buying an insurance policy. For more information on savings plans, read here.