A guaranteed income plan is primarily for risk-averse investors. Under this income plan, the investors are offered life insurance with maturity benefits and regular guaranteed payouts. Also, a guaranteed income plan provides a steady income at a predefined percentage from the sum assured opted by the policyholder while purchasing the policy.
The pandemic has made people more worried about the risks of life. Hence, they want to be more prepared to maintain their financial stability and protect both their money and their family. So, they are looking for the best long-term savings plans to safeguard their family’s future.
- Equity Mutual Funds: Usually, earnings from investments in shares are taxable under the Income Tax Act 1961. But if you invest in tax-saving mutual funds, also known as Equity-linked Savings Scheme, you are eligible to get a deduction under section 80D for a maximum investment of Rs.1.5 lakhs.
- Public Provident Fund (PPF) – Individuals who are risk-averse and want to save money for their post-retirement plan and goals can invest under PPF. You can get income tax benefits under section 80C for investing in PPF. It is a government tool to begin investing with as low as Rs.500 and can go up to Rs.150000 per annum.
- Unit Linked Insurance Plans: With a lock-in period of 5 years, these funds invest your money in the equity and debt market and provides you with good returns along with an insurance benefit.
- National Savings Scheme: It is a government-sponsored scheme carried out by the post office of India. You can invest money in the plan with an amount as low as Rs.100 with no maximum limit. The lock-in period for such a scheme is five years.
- National Pension Scheme: It is also a government-supported scheme where people can begin saving early to enjoy their retirement benefits. That the lock-in period for this scheme is till retirement.
Tips for A Long-Term Savings Plan
- The essential factor of long-term savings is to maintain self-discipline. You can always learn about and invest from the internet and invest. But developing the habit of saving every month is essential.
- With the increase in income, your savings should also increase. If you want to invest in guaranteed income plans, invest your every bonus or increment in your chosen investment instrument.
- Do not panic in small stressful situations. None of us know the future, but you must be both aware and calm if you are investing in the equity market. A slight fall in the price of a share should not render you tensed majorly. https://www.pnbmetlife.com/insurance-plans/family-protection/mera-term-plan.html
- Follow the 50-30-20 rule to encourage your savings. Once the salary comes in, spend 50% on your living expenses like rent, groceries, essentials, etc., 30% for entertainment purposes like meeting friends, weekend trips, going to movies, etc., and keep the remaining 20% in your savings account. Instead, put away the 20% first and then begin your expenses so that you spend little.
Long term savings plan serves in supporting your family members when you are not around to do that any longer. Shop around and compare the features and benefits each plan offers before opting for one.