Retirement is a phase when you want to relax and enjoy your life after continuous, long and hectic professional life. On the financial front, your regular income also stops. Managing post retirement expenses may become hard for you with growing inflation. Only 4% of the total working population of India is covered by a pension scheme, usually government employees. The remaining population is either salaried or self employed who do not have the provision of a formal pension scheme.
Ideally, life insurance covers the risk of “dying too early “ or “living too long”. Pension Plans being a part of life insurance products cover the risk of living too long. Insurance companies provide the dual benefits of pension and insurance cover under pension plans. Pension plans help individuals to plan for their retirement effectively and provide individuals with a regular income for their post retirement years. Also, in the event of the death of the insured, the amount specified as per the policy is paid to your nominee. A pension plan helps you achieve the financial stability after your retirement. You need to infuse a specific amount of money during your working phase to build a corpus.
These plans are best for those planning a secure future. Retirement plans are a decisive way of safeguarding that your current lifestyle is maintained even after you stop working.