After retirement you have no source of income. In such a situation, annuity plans can be very helpful for you. Know what it is and how many types it is.
After retirement, you do not have any source of income, but the need for money remains. In such a situation, one has to depend on others for small needs. Therefore, it is very important that along with your job, you make such arrangements for yourself so that you continue to get regular income in old age and you do not have to depend on anyone for money. In such a situation, annuity plans can be very helpful for you.
Annuity is an insurance product, in which there is a kind of contract between you and the insurance company. In this the person has to invest lump sum. In future, you are paid in return monthly, quarterly or annually. Annuities are used as part of a retirement portfolio. In this, as long as you survive, you get fixed income. After your death the nominee is entitled to receive the amount. But there are many types of annuity plans. If you are also planning to purchase it, then first know about it-
There are many types of annuity plans
Life Annuity: In this, annuity is paid to the person till his death. You can choose whether the payment is monthly, quarterly or annually.
Annuity for guaranteed period: In this, annuity can be paid for a certain amount even after the death of the policy holder. After the completion of a certain period, the receipt of annuity also stops.
Joint Life Annuity: In this, after the death of the policyholder, annuity is paid to your spouse for his entire lifetime.
Life Annuity with Return of Purchase Price: In this the policyholder will get annuity payment till his death. After death, the amount paid by them to buy the annuity is returned to their nominee.
Joint Life Annuity with Return of Purchase Price: In these plans, after the death of the policyholder, his spouse gets annuity for his entire life and after his death, the nominee gets the amount initially invested.
Tax benefits are not available
Keep in mind that annuity is linked to your income, hence you do not get any kind of tax exemption in it. Policyholders have to pay tax according to the tax slab they fall in.
