How to choose Annuity Plan?
How to choose Annuity Plan?
so that you can live a life of peace and happiness at the golden time of life i.e. at the time of retirement without financial difficulties and worries.
How and what should be the criteria to choose a better annuity because once a decision is taken, it is difficult to change it.
Annuity Plan
How to select Annuity Plan the key parameters for choosing annuity-like any financial product are security, returns, and liquidity. While choosing annuity, you have to keep in mind that you may have to depend on the returns you get after retirement.
Security in Annuity Plan
The safety aspect is paramount in choosing any annuity as it is a very long-running scheme. The person buying annuity regularly saves through premiums paid to the insurance company for a long time before retirement. On retirement, he expects the payment of annuity to continue for 20-30 years.
Financial Position of the Company
This means that the annuity company should be in a position to meet the liabilities that can change due to a number of reasons such as prolonged aging, interest rates, incidence, inflation, etc. Therefore, the economic strengthening of the annuity provider is important. The better the financial health of the company.
Return in Annuity Plan
The role of returns after security is important as annuity is a very long-term plan. Most companies are narrow in terms of returning. These companies do not fully pass the returns earned to the customers but retain a large part of the earnings as reserves to meet the sudden needs.
This narrow approach can be detrimental to the interests of those who rely solely on annuity's income to pay their expenses. Since inflation reduces the actual value of returns, low returns can cause difficulties in advancing age.
Liquidity
Liquidity is also required to be kept in mind while choosing a pension policy. Due to their structure, annuity plans are not very liquid and cannot be withdrawn like fixed deposits, life insurance policies or mutual fund units. A sudden financial need can put you in trouble.
The possibility of partial withdrawal under important circumstances can make your annuity plan a better option. However, it is generally advised not to withdraw money from the annuity plan.
Other Factors
Aside from product features or promotions, viewing the annuity provider's previous track record can be the best way to choose it. Industry track records, previous annual returns and how to choose the company's current financial strength annuity plan may be some of the major factors to decide.
Hi , This is Pramod Choudhary from Nagaur Rajasthan India. I an student and I would like to share my positive thinking with everyone that's my passion . Thank you
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