What Is A Savings Plan and Guaranteed Income Plan?

Both savings and guaranteed income plans are life insurance plans that provide different covers to policyholders and their families. These plans help safeguard the policyholder’s financial future and help them live a happy and peaceful life ahead. The plans also help them meet their desired goals and remain stress-free for as long as they can.

Both savings plans and guaranteed income are different from one another. While the former helps save and invest money systematically, the latter are non-participating plans that offer endowment assurance at a fixed rate.

Let us know more about both below!

An Overview of the Two Plans  

Savings Plan

A savings plan provides a systematic and disciplined method to save and invest money properly. This plan prepares the family to safeguard their financial future by saving and investing intelligently. Thus, it helps them to fulfill their goals and meet their future daily needs exponentially. A few key factors play a significant role in choosing the right savings plan for yourself.

1. Charges

A savings plan generally comes with a host of extra charges that you must pay timely for this plan to function. Switching costs, premium charges, fund management charges, and mortality charges are various tasks you must pay. Although you cannot get rid of them under certain circumstances, you can always choose those plans with a minimum of them.

2. Entry age and tenure

A savings plan generally offers an extensive entry age bracket with a convenient policy term and investment tenure. It is the entry age that plays a role in determining the risk of the policyholder’s appetite. People between ages 20 to 30 can take the best lucrative plans and make the most of them.

3. Investment options

This type of plan is open to various investment options that range from equity to safer instruments like money market instruments, corporate bonds, and government securities.

4. Life cover and riders

One of the best savings plans like ULIPs provides dual benefits of life insurance cover and market-linked savings returns that make them a preferred investment option. The ULIP savings plan provides for the addition of specific riders that can improve the policyholder and his family’s financial security.

Guaranteed Income Plan

These are non-participating plans that have an endowment assurance at a fixed rate. Thus, it will want you to pay the premiums for a specified period. As soon as the plan matures, you will begin to receive benefits. All the premiums you pay will come to you in an assured manner later. Thus, all the investments and savings that occur happen appropriately without any hindrance. Here are some of the benefits of this plan that may help you know more.

1. Guaranteed maturity benefits

The best part about opting for a guaranteed income plan is that it benefits you right at the time of maturity without failure.

2. Death benefit

You may also receive death benefits in case of the policyholder’s untimely demise to safeguard the family’s financial future.

3. Premiums

One can pay premiums over some time or at once. This occurs to provide flexibility to the policyholder and renders a hassle-free experience like no other.

4. Loans

The savings plan also provides loans that help them to ease their financial status. Thus, you can seek loans from the insurer when in need and use the money to secure your financial status in need without enough hindrances.

The Bottom Line

Ensure you consider the savings plan and guaranteed income plan properly when looking for an investment option. So, why keep waiting? opt for it right away to experience convenience for a lifetime.