In this economy and in the current changing times and changing tides, everyone is concerned about their retirement plan. For some, it can be a matter of being spoilt for choices as these days the way in which one can secure their future are almost innumerable.
There all kinds of pension plans, insurance policy plans, investments, tax-saving investments and more. However, the upcoming Budget for which everyone is waiting with the knee-bouncing kind of impatience could potentially throw everything in the air.
The anticipation of the upcoming budget means that everyone will be rooting for their own specific goals to be included but more than that, this Budget becomes important since this will be the last budget by the current government. This will be followed by the elections. So it stands to reason that the interest level is at an all-time high in the Budget. Keen to see how the current ruling government will make one last impact and what all changes have been made in the last year, it has been observed -
❏ It has already been noted that in the medical field, the retirement age has been increased to 65. Earlier, depending on the departments, some doctors had prescribed retirement at 60 while some others had it at 62. However, the age limit was increased to retain the experienced doctors in the field and through the trickle-down-effect, for the betterment of the patient-doctor relationship.
❏ The National Pension Scheme originally meant for government employees but later opened for all, is another sector which was taken into account. And so, with the current budget, the finance minister chose to move forward with a slight change which would enable anyone to withdraw their fund without running into any tax troubles.
❏ In the Budget of the year 2016, the government had originally put a condition of sorts on the heads of anyone who chose to withdraw before the retirement age of 60 years. If the person withdrawing had not reached the retirement age, then they would have to invest approximately 80% in annuity products while only 20% would come into their hands.
❏ If this exchange would happen with the age of the person withdrawing being above 60, then the amount would be tax-free, but only up to 40%.
❏ This has been revised and the government will now provide even more relief to everyone who has invested in the top pension schemes, starting from the 1st of April, 2018.
❏ Since it is still unclear if mutual funds will finally be allowed to get a potential pension plan collaboration, there are various sources that are now suggesting to invest in some of the best pension plans that will be the best plan for the upcoming year. Some of those are -
● An immediate annuity plan. Here, there are approximately 6 options out of which whatever suits the policyholder the most can be selected and the policyholder will be required to pay the premium in a lump sum amount. The policyholder can receive the amount in any timely manner, be it monthly or quarterly, however they see fit. Other criteria to keep in mind will that the age limit starts at 30 and ends at 85.
● ULIP (United Linked Plan) which can offer the policyholder a market-linked return. This policy also offers various different ways in which the policyholder can pay their premium and gives a beneficial return as well. The age criteria for this policy are between 18 years and 65 years. The important point to be noted here is that in case of death, a higher fund value shall be given to the nominee. Alternatively, it can be calculated as 105% of the premium paid till death.
● Being loyal to a “brand” or a place, be it your local grocer, a skincare brand or a type of plan or insurance company has its perks! An Assured Pension Plan (which is also a ULIP) offers both loyalty benefits and market-linked returns. The age criteria for this between the ages of 18 to 45.
● Another plan has been introduced which will allow the policyholder to save in such a manner that they will be able to continue their lifestyle after retirement, through the regular inflow of money. This plan is called Smart Pension Plan, a non-participating ULIP. The age criteria for this plan is anywhere between the ages of 18 to 70.
There are many more such plans that are there in the market. While they wait with bated breath is on for the Budget to be released, it is possible for us to start investing straightaway for our future. However unlikely as it may sound, the future and the ability to control is now in our hands. Well, to some extent at the very least.