Com­par­i­son with Other Pen­sion Funds

Consumer Voice - - Bfsi -

Post Of­fice Se­nior Cit­i­zens Sav­ings Scheme This gen­er­ally of­fers slightly bet­ter rates than most an­nu­ity plans from life in­sur­ance com­pa­nies. How­ever, it has a max­i­mum limit of Rs 15 lakh per per­son and the in­come from this scheme is tax­able. Post Of­fice Monthly In­come Plan This also has at­trac­tive rates, but again has a max­i­mum limit of Rs 4.50 lakh per per­son and the in­come from this scheme is tax­able. Bank or NBFC De­posits These of­fer monthly pay­outs, but al­low you to in­vest only for five years at a time. Se­nior Cit­i­zens Sav­ings Scheme The above holds true for this type of scheme too, de­spite its high re­turn. At the end of five years, if in­ter­est rates in the econ­omy fall, your in­come will fall as well. Debt Mu­tual Funds Debt mu­tual funds or monthly in­come plans may de­liver bet­ter re­turns with any­time liq­uid­ity, but are linked to mar­ket risks. Com­par­a­tively, an­nu­ity plans are the only long-term op­tion with com­pletely pre­dictable re­turns. Na­tional Pen­sion Sys­tem (NPS) The max­i­mum en­try age to join this scheme is 60 years. It has a pre­scribed yearly con­tri­bu­tion. There are va­ri­eties of charges payable (one time and yearly) in­clud­ing fund man­age­ment, en­roll­ment fee and cus­to­dian charges. Forty per cent of the NPS fund on pay­ment has to be in­vested in an­nu­ity fund. How­ever, in­come tax ben­e­fits are at­trac­tive. Atal Pen­sion Yo­jana (Swavalam­ban Scheme of NPS merged with this scheme) The max­i­mum en­try age to join this scheme is 40 years. Con­tri­bu­tions are manda­tory up to a min­i­mum of 20 years. Monthly con­tri­bu­tions go into a cor­pus fund from which life pen­sion is given on com­ple­tion of 60 years to the pro­poser/nom­i­nee.

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