Top 5 benefits of Guaranteed Income Plans why choose them for Retirement Planning!
Regular Income is a crucial need for Retirement
Regular income is a crucial need as well as benefit for retirement because it ensures a steady stream of income to cover your living expenses during your retirement years. When you retire, you no longer have a regular source of income, and you may have to rely on your savings, investments, and other sources to meet your expenses. Having a guaranteed income through retirement plans like guaranteed income plans can help you meet your living expenses and maintain a comfortable lifestyle without worrying about exhausting your savings or investments.
Tax benefits are also beneficial for retirement planning because they help you save on taxes, which can increase your retirement income. Retirement plans like guaranteed income plans offer tax benefits by allowing you to claim tax deductions on the premiums paid towards the plan under Section 80C of the Income Tax Act. Additionally, the income received from these plans is also tax-free under Section 10(10D) of the Income Tax Act,1961. This means that you can receive a tax-free income during your retirement years, which can help you save a significant amount of money and increase your overall retirement income.
Guaranteed Income Plans provide Regular Income and Tax benefits
Guaranteed income plans are a type of insurance policy that provides a guaranteed amount of income for a fixed period. The amount of income you receive is predetermined and does not depend on market fluctuations.
These plans are ideal for retirement planning because they provide a regular stream of income that you can rely on, regardless of market conditions. This is particularly essential for those who either retired or approaching the retirement age and want to ensure that they have a stable source of income to cover their expenses.
Guaranteed income plans offer tax benefits as the premiums paid towards them are eligible for tax exemption coming u/s 80C of the Income Tax Act, 1961. Moreover, the income received from these plans is also tax-free under Section 10(10D) of the Income Tax Act,1961.
These plans offer the flexibility to choose the frequency of income payouts. You can opt for monthly, quarterly, half-yearly, or annual payouts depending on your financial needs and requirements.
One of the major benefits of guaranteed income plans is that they provide a guaranteed return on your investment. This means that you can plan your retirement income in advance and have peace of mind knowing that you will receive a fixed income for a specified period.
Guaranteed income plans are a good option for retirement planning as they provide a steady stream of income, tax benefits, and a guaranteed return on your investment. However, it is important to do your research and choose a plan that suits your financial goals and needs.
Top 5 Benefits of Guaranteed Income Plans
- Guaranteed income: Guaranteed income plans offer a guaranteed income to the policyholder for a fixed period of time. This means that you can plan your finances in advance and have peace of mind knowing that you will receive a fixed income irrespective of market conditions.
- Tax benefits: Guaranteed income plans also offer tax benefits to policyholders. The premiums paid towards these plans are eligible for tax deductions u/s 80C of the Income Tax Act,1961. Additionally, the income received from these plans is also tax-free under Section 10(10D) of the Income Tax Act,1961.
- Flexible payout options: Guaranteed income plans offer flexible payout options, allowing policyholders to choose the frequency of income payouts based on their financial needs and requirements. You can opt for monthly, quarterly, half-yearly, or annual payouts depending on your preference.
- Protection against inflation: Guaranteed income plans also provide protection against inflation by offering a fixed payout that increases over time. This means that the income received from the plan will increase at a pre-determined rate, helping policyholders to maintain their purchasing power and meet their expenses even in the face of inflation.
- No market risk: Guaranteed income plans do not expose policyholders to market risk as the payout is fixed and does not depend on market fluctuations. This makes these plans a safe and secure investment option for individuals looking to secure their financial future.
The Budget 2023 declared that on or after 1st April 2023, returns from traditional income plans will get taxable if the premium from one or more policies exceeds Rs.5,00,000. So the change might affect high-value guaranteed income plans, and buying these on or before 31st March 2023 is beneficial to the customer.
Conclusion: Regular income and tax benefits are important benefits of retirement planning as they provide a steady source of income and help you save on taxes. By choosing retirement plans such as Guaranteed Income Plans, well withing timeline that can offer you to secure your future and ensure a comfortable retirement life with the regular income and tax benefits.
