What is a 1-Crore Retirement Pension Plan?

 

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Every robust financial plan includes a retirement strategy. A retirement plan is paramount for individuals hoping to enjoy financial independence in their golden years. You can choose to purchase a 1-crore retirement plan based on your goals. The policy helps you accumulate a corpus of Rs. 1 crore to meet your needs. Additionally, the plan offers life insurance coverage, providing financial safety for your loved ones in the present. Let’s better understand these policies and how they work.

What is a 1-Crore Retirement Plan?

A 1-crore plan is a financial tool that enables you to accumulate a corpus of Rs 1 crore over the policy term. The amount provides financial safety and stability during your golden years. Additionally, retirement plans have a life insurance component. The policies allow you to safeguard your family’s financial present while building a corpus for your future.

How Does a 1-Crore Retirement Plan Work?

A 1-crore retirement plan works on systematic savings and strategic investments. Let’s understand this with an example. Sushma is a 30-year-old banker. Although her husband earns well, Sushma wants to build a corpus to safeguard their retired life. They hope to travel and pursue various hobbies once they both turn 60. She purchases the HDFC Life Click 2 Retire plan for thirty years. Every year, she pays a premium that provides life insurance coverage and exponential growth. She selected a mix of debt and equity funds to invest the premium.

Based on the returns, she is able to build a corpus that amounts to Rs. 1 crore in 30 years. Once she retires, Sushma receives a portion of the accumulated corpus. She uses the balance to purchase an annuity that provides life-long income. Sushma can use the income payouts to maintain her standard of living and rely on the rest of the corpus to fulfil her retirement goals.

What Are the Benefits of a 1-Crore Retirement Plan?

When you select a plan, you enjoy:

• Financial Stability
  A 1-crore plan provides a significant corpus to rely on during your golden years. It enables you to meet your daily expenses, financial obligations and healthcare expenses. Additionally, it allows you to pursue various goals.
• Builds Financial Discipline
  A 1-crore retirement plan works on consistent savings. It encourages you to live on a budget and put money away for later. This disciplined approach to savings and investment can help build a secure financial future.
• Tax Benefits
  Retirement plans also offer tax benefits on contributions and withdrawals. You are eligible to claim deductions against Section 80C of the Income Tax Act¹. Ensure you consult a tax advisor to understand your liabilities.
• Legacy Planning
  A well-structured retirement plan like HDFC Life Click 2 Retire provides security for future generations. While building a corpus, you enjoy the added benefit of life insurance coverage. Should anything happen to you, your beneficiary or heir receive a payout based on your plan terms and conditions? The amount could help them with their current financial liabilities and future goals.

What to Consider When Choosing a 1-Crore Retirement Plan

Before selecting a 1-crore retirement plan, ensure you evaluate the following:

• Financial Goals and Timelines
  Carefully consider your retirement goals. When do you want to retire, and how much time do you have to build the required corpus? The answers to these questions enable you to identify plans that align with your goals.
• Available Plans and Benefits
  Thoroughly research the various retirement plans offered by insurance companies. Compare their historical performance, fees, and flexibility. Ensure you consider the customer reviews and claim settlement ratio. Select a credible company to safeguard your investment and grow your wealth.
• Life Coverage
  Consider the amount of coverage required. Evaluate your Human Life Value (HLV) and select a plan that fulfils your needs. Remember, the payout should safeguard your family’s finances.
• Historical Performance
  Examine the track record and historical returns of various retirement plans. Although past performance cannot guarantee future returns, it offers insights into potential returns. Look for policies that provide consistency and stability.

A 1-crore retirement plan helps secure your financial future. Setting clear goals, adopting a disciplined approach, and choosing the right avenue allows you to embark on a journey towards financial independence. Remember, it is never too early to start planning for retirement. Start today, and turn your dreams into reality as you build a substantial corpus to support the retirement you envision.

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