In order to fight away any emergency or crisis related to finances, a person needs to have a decent amount of savings. This is possible only when you invest in a savings plan.
A savings plan is a life insurance plan that offers a great opportunity for individuals to save funds for future needs. Investments always help an individual save in a systematic and disciplined manner so that it allows them to achieve their goals – either short term or long term. Various features are being provided in savings plans to meet the specific needs of an individual, which helps them make an investment as per their own suitability and risk.
Not only this but death benefit along with insurance coverage is also provided to the beneficiary. The death benefit is provided in case of the unfortunate demise of the insured during the policy tenure. One of the biggest advantages of savings plans is that they are low-risk investments that offer good returns.
Factors Considered While Investing in Savings Plan
In order to live a secure and stress-free life, it is very important to do proper and systematic financial planning to meet the future uncertainties of life. The best way to become financially secure is to start saving at the earliest. By making an investment in the savings plan, one can start saving from a young age and can also avail the benefit of good returns with the saving of taxes. Moreover, there are certain factors that need to be kept in mind while making an investment in a savings plan:
Additional Financial Security
In order to increase the financial security of the family, a term insurance policy provides the insured person’s nominee with an additional payout of up to Rs 2 crore in case of accidental death.
A term insurance plan also provides tax benefits on the premium paid under section 80C. There is an additional tax benefit under section 10(10D) on the money that the policyholder’s family receives at the time of an unfortunate event.
At the time of the unfortunate death of the policyholder during the policy term, the family of the insured person receives the death benefit. The nominee can also choose to receive a regular income along with the lump sum benefit in the policyholder’s absence.
The market is flooded with numerous savings plans, and each plan has its own pros and cons. Thus, we must consider every risk associated with the plan to make the right decision.