An immediate annuity plan is an insurance policy that offers individuals a regular income stream in exchange for a lump sum payment to an insurance company. It is mandatory to allocate 40 per cent of the corpus received from the National Pension System (NPS) towards the purchase of annuities. The lump sum received from the Employees' Provident Fund (EPF) upon retirement can also be utilized to purchase an annuity.
Immediate annuities provide several benefits. Upon purchasing the plan, the insurance company promptly initiates regular income payments to the policyholder. These plans do not involve any investment risk as the insurance company guarantees the payouts. The payout remains unchanged throughout the plan's duration, protecting investors from fluctuating interest rates. Customers can also opt for the joint-life option, ensuring a lifetime payout for their spouse. It is advisable for married individuals to purchase the joint-life option to ensure her/his financial well-being even after the policyholder's demise.
One drawback of annuities is that their payouts are constant and not adjusted for inflation, meaning that the real value of the income stream will diminish over time.
Immediate annuities are also illiquid. While it may be possible to exit certain options and retrieve the principal amount, one would typically incur a significant penalty. In some options, exit is not permitted.
هذه القصة مأخوذة من طبعة June 2023 من Investors India.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة June 2023 من Investors India.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
Thematic Fund Or Sectoral Fund, Which Fund Suits You?
A thematic fund is a type of mutual fund that focuses on investing in companies based on specific themes or trends.
Be Kind To Your Kidneys
The kidney is a vital organ in our body which is four inches long and two and a half inches in width.
Have You Included A Passive Fund In Your Portfolio Yet?
The assets under management (AUM) of passive funds recently crossed the Rs. 10 lakh mark. While a significant portion of this money comes from institutional investors, such as the Employees Provident Fund Organisation (EPFO), these funds are also gaining popularity among retail investors.
Mutual Fund
1. SEBI allows mutual funds to buy and sell credit default swaps (CDS)
Insurance News
1. The finance minister has launched a new NPS scheme named NPS Vatsalya
ASK THE EXPERT
Dear Sir, I attended your webinar on post-retirement financial planning. As advised by your good self, I invested in NPS after retirement.
Market Mystery: Some Important Investing Lessons from Fund Managers Themselves
Mr. Mahesh Patil is the Chief Investment Officer (CIO) of Aditya Birla Sun Life AMC Limited. As the CIO Mahesh oversees INR 3 lakh crore of assets under management.
How to make a cautious entry into equity funds during a bull market
The number of mutual fund folios has been rising, with flows via the systematic investment plan (SIP) route reaching new highs.
All that you need to know to kickstart your retirement planning process
We all enjoy planning for the future. It’s a good idea to plan ahead of time for anything, from the day’s activities to a vacation.
5 Steps To Achieve Your Financial Goals
From a beach house, a Jaguar, to traveling the world – there are many things in life that we want to accomplish.
