Savings is the first step towards long-termfinancial security in life. It reduces stress and helps avoid debts. A good savings plan is the first step towards planning future investments as well. Apart from saving money, you need to consider growing your wealth to fulfil long-term goals.
Picking the right plan can be tricky. You need to consider your future goals, as well as your short-term requirements. Risk assessment can be important as well.
So, it is vital to understand a few factors beforehand. This can help you choose the ideal plan to tick off your life goals. Have a look.
Easy Online Buying
You must be able to purchase a savings plan online. This is one of the most crucial features of a good plan. Online plans can help you set up an automated investment. Customers can talk to experts online for clarifications and guidance. You can easily invest, deposit, and withdraw funds without visiting the branch. Further, you can track the performance of various plans online and modify the investments.
Plan Benefits
The best savings plan in India comes with a series of benefits. You must check the below points before investing.
- Basic sum assured plus accrued guaranteed additions will be paid on survival of the life assured till the end of the policy term.
- Sum assured on death along with accrued guaranteed additions will be payable to the nominee or beneficiary.
- Twin benefits of life cover and savings at reasonable premiums.
Further, make sure the plan offers easy application and quick processing. Monthly and yearly payment options must be available for added convenience.
Tax Savings Option
The right savings plan can enable tax exemptions as per various laws of the IT Act 1961.For instance, a deduction on the premium on the guaranteed return plan is available under Section 80C of the Income Tax Act, 1961. This is subject to change from time to time. However, if the premiums paid during a financial year exceed 10% of the sum assured, the benefit will be limited up to 10% of the sum assured. Do consult your tax advisor for details.
Investment Terms
The savings plan must allow you to make yearly or monthly payments. A flexible investment makes the plan useful for everyone with different financial capabilities.
Grace Period
This protects you from losing coverage if you fail to make timely payments. Additional time is given to policyholders to clear the premiums past the due date. Make sure the savings plan allows a grace period of 30 days for yearly premiums and 15 days for monthly premiums. This makes it easy to continue with the policy benefits if you are facing a financial crunch.
Use a savings plan calculator and fill in basic details like policy term and annual premium to know the sum assured and the maturity benefit. Further, do read the terms and conditions carefully before choosing and purchasing a plan.