Pension plans are specifically designed to secure the financial future of individuals post-retirement. They work by allowing individuals to contribute a portion of their earnings throughout their working years. These contributions grow over time, generating returns and building a pool of funds. Some of the best retirement plans in India cater specifically to the unique needs and preferences of NRIs.
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A pension plan in India is the best investment plan to provide you with a life cover along with regular income during your retirement years.
It involves you contributing a portion of your earnings to a pension fund managed by the insurance company. The accumulated funds are invested in market-linked investment options to generate high returns. Upon maturity, you receive regular pension payments.
Investing in the best pension plan in India ensures financial security and stability for you and your family after you cease working.
The following table shows the overview of the best retirement plans in India for an NRI in 2024:
| Pension Plans in India | Entry Age | Maturity Age | Policy Term | Tax Benefit |
| Aditya Birla Sun Life Empower Pension Plan | 25 - 70 years | 80 years | 5-30 years | Offers tax benefit U/S 80C of IT Act |
| Bajaj Allianz Life LongLife Goal | 18 - 65 years | 99 years of age | 99 years - Entry age | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| Bajaj Allianz Pension Guaranteed Pension Plan | 0 - 100 years | N/A | Lifetime | Offers tax benefit U/S 80C & 10(10D) of IT Act |
| Edelweiss Life Tokio Wealth Secure Plus | 18 - 60 years | 18 - 70 years | 5 - 25 years | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| HDFC Life Click 2 Wealth | 18 - 60 years | 18 - 75 years of age | 20 - 64 years | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| ICICI Pru Easy Retirement Plan | 18 - 70 years | 30 - 80 years | 10, 15, 20, 25, 30 years | Offers tax benefit U/S 80C & 10(10D) of IT Act |
| ICICI Prudential Signature | 18 - 75 years | 99 years | 10 - 30 years | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| IndiaFirst Life Guaranteed Annuity Plan | 40 - 80 years | N/A | Lifetime | Offers tax benefit U/S 80C IT Act |
| Kotak Premier Pension Plan | 30 - 60 years | 45 - 70 years | 10 - 30 years | Offers tax benefit U/S 80C of IT Act. |
| LIC Jeevan Akshay 7 Pension Plan | 25 - 100 years | N/A | Lifetime | Offers tax Benefit U/S 80C of IT Act |
| LIC New Jeevan Shanti Pension Plan | 30 - 79 years | 31 - 80 years | -- | Offers tax Benefit U/S 80C of IT Act |
| Max Life Forever Young Pension Plan | 30 - 65 years | 50 - 75 years | 10 to 75 years-Entry age | Offers tax benefit U/S 80C of IT Act |
| Max Life Guaranteed Lifetime Income Pension Plan | 0 - 85 years | 26 - 90 years | N/A | Offers tax benefit U/S 80C IT Act |
| Max Life Online Savings Plan | 18 - 60 years | 18 - 45 years | 5 - 67 years | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| SBI Life Saral Retirement Saver | 18 - 65 years | 40 - 70 years | 5, 10 to 40 years | Offers tax benefit U/S 80C of IT Act |
| Tata AIA Fortune Maxima | 18 - 60 years | 100 years | 100 minus issue age | Offers Tax benefits u/s 80C and 10 (10D) of the Income Tax Act, 1961 |
| Tata AIA Life Guaranteed Monthly Income Plan | 6 - 60 years | 68 years | 5, 8, 12 years | Offers tax benefit U/S 80C & 10(10D) of IT Act |
Disclaimer: †† Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is done in alphabetical order (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
A variety of pension plans that are designed to meet your retirement needs are available in India:
Deferred Annuity
Immediate Annuity
Annuity Certain
Defined Contribution
With & Without Cover Pension Plan
Guaranteed Period Annuity
National Pension Scheme (NPS)
Defined Benefit
Life Annuity
Pension Funds
Whole Life ULIPs
| Term | Description |
| Deferred Annuity |
|
| Immediate Annuity |
|
| Annuity Certain |
|
| Defined Contribution |
|
| With & Without Cover Pension Plan |
|
| Guaranteed Period Annuity |
|
| National Pension Scheme (NPS) |
|
| Defined Benefit |
|
| Life Annuity |
|
| Pension Fund (PF) |
|
| Whole Life ULIPs |
|
You can avail of numerous advantages by investing in a pension scheme in India. Some of the most important ones are as follows:
Annuity: An annuity is a fixed annual payment that you receive throughout your lifetime. An annuity can either be immediate or deferred, depending on your preference.
Death Benefit: Pension plans in India also provide a death benefit to the nominee in case of your unfortunate demise. This ensures that the family is financially secure even after the death of the breadwinner.
Choice of Investment Options: NRIs have a wide range of investment options to choose from when it comes to pension plans in India. You can invest in equity funds, debt funds, or a combination of both.
Early Withdrawal: You can also withdraw a part of your pension corpus before retirement under certain circumstances, such as medical emergencies or higher education expenses.
Flexible Withdrawal Options: NRIs can choose from a variety of withdrawal options, such as lump sum withdrawals, regular annuity payments, or a combination of both.
Tax Benefits: You can avail tax benefits on your pension contributions under Section 80C and Section 10(10D) of the Income Tax Act, 1961.
Entry Age: You can join a Pension Plan when you are at least 18, though some plans might start at 30. The upper limit for entry is usually around 70.
Premium: To get a Pension Plan, you need to pay a minimum premium. The pension you receive depends on how much premium you have paid.
Vesting Age: Vesting age is the point at which you begin receiving a monthly pension from your pension plan.
Payment Period: The payment period is when you start receiving payments after retirement.
Accumulation Period: The accumulation period covers the entire duration during which you make regular premium payments towards your policy or plan.
Some of the several advantages of having the best pension plan in India for Non-Resident Indians (NRIs) in Singapore are as follows:
Financial Security: Pension plans provide you with a reliable source of income after retirement. This ensures financial stability during your golden years.
Tax Benefits: Pension plans often come with tax advantages, allowing you to optimize your financial planning and reduce your tax liabilities, both in India and Singapore.
Currency Diversification: By investing in Indian pension plans, you can diversify your investment portfolio and gain exposure to the Indian rupee. This allows you to gain potential benefits from currency appreciation.
Long-Term Savings: Pension plans encourage disciplined and long-term savings. This helps you to build a substantial retirement corpus over time to meet your future financial needs.
Flexible Investment Options: Many pension plans offer a range of investment options, allowing you to tailor your portfolio based on your risk tolerance and financial goals.
Repatriation Benefits: Some pension plans provide options for the repatriation of funds. This enables you to bring back your accumulated savings to Singapore or any other country of residence.
Nomination Facility: Pension plans typically offer a nomination facility. This ensures that the accumulated benefits are seamlessly transferred to the nominee in the event of your demise.
Inflation Hedge: Pension plans often come with features that help protect against the impact of inflation. This allows you to maintain the purchasing power of your accumulated corpus over the years.
Peace of Mind: Having a pension plan in place gives you peace of mind, knowing that you have a structured financial instrument to support your lifestyle and expenses during retirement.
Social Security Net: Pension plans serve as a form of social security, providing you with a reliable income stream and reducing dependence on family or external support during retirement.
You need to consider the following key aspects before starting to invest in the best pension retirement plans in India:
You need to understand the regulatory framework for NRI investments in Indian pension plans.
Check eligibility criteria and ensure compliance with relevant regulations.
For Example: Annually in November, you need to submit a life certificate either from the Indian Embassy or your local bank in the country where you currently reside.
Evaluate whether contributions and payouts are in Indian Rupees or foreign currency.
Assess the impact of currency fluctuations on returns.
Open a Non-Resident Ordinary (NRO) account with an Indian bank, as your pension will be credited to your NRO account.
If you have an existing domestic savings account in India then inform your pension plan provider and corresponding bank of your NRI status. Request conversion of your domestic bank account into NRO account
Be aware of the tax implications in both India and the NRI's resident country.
Understand the Double Taxation Avoidance Agreements (DTAA) that may apply.
Understand the rules and procedures for repatriating pension funds.
Confirm the ease of transferring funds back to the NRI's country of residence.
Nominate beneficiaries to ensure a smooth transfer of benefits in the event of the investor's demise.
Keep nomination details updated.
Stay informed about the performance of the pension plan.
Consider professional financial advice for effective portfolio management.
Understand the exit options and withdrawal rules.
Plan for the maturity or premature withdrawal of the pension plan.
Assess the risk profile of the chosen pension plan.
Balance potential returns with the level of risk acceptable to the investor.
Choose pension plans that offer features to counter the impact of inflation.
Ensure the plan provides a reasonable real rate of return.
Investing early in a Pension Plan in India provides various benefits to you, such as the following:
Long-Term Financial Security: Early investment ensures a substantial corpus for a comfortable retirement.
Power of Compounding: Starting early maximizes compounding, multiplying your wealth over time.
Currency Advantage: NRIs benefit from favourable currency exchange rates during investment.
Tax Benefits: You can avail tax advantages early on for your contributions and withdrawals as per Indian tax laws.
Mitigating Inflation: Beat inflation by building a robust pension fund through early investments.
Flexibility and Control: Start early to have greater control over your investment strategy and goals.
Financial Discipline: Inculcate a habit of regular saving and disciplined financial planning.
Peace of Mind: Early pension planning ensures a stress-free and financially secure retirement for NRIs.
The following is a step-by-step guide to purchasing the best retirement plan from Policybazaar:
Step 1: Assess your retirement needs- Think about your retirement goals and lifestyle, calculate your estimated expenses in retirement, and consider your current financial situation and obligations.
Step 2: Research and compare pension plans- Explore different pension plans offered by Policybazaar. Ensure that you read reviews and compare ratings of different plans. You need to compare the features, benefits, and costs of various plans.
Step 3: Review terms and conditions- Thoroughly examine the terms and conditions of the retirement plan. Understand the vesting period, contribution limits, and withdrawal restrictions.
Step 4: Choose the best plan for you- Consider your retirement goals, financial situation, and risk tolerance. Select a plan that offers the features and benefits that are most important to you.
Step 5: Buy the plan online or offline- Policybazaar offers the convenience of buying pension plans online or offline. You can also contact a Policybazaar representative to help you with the process.
Step 6: Monitor and review your plan- Regularly track the historical performance of your pension plan. Always monitor your plan and adjust your contributions or investment strategy as needed.
State Bank of India (SBI)
HDFC Bank
ICICI Bank
Kotak Mahindra Bank
Axis Bank
*All savings are provided by the insurer as per the IRDAI approved insurance
plan.
*Tax benefit is subject to changes in tax laws. Standard T&C Apply
†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
23 Oct 2024
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