Best Annuity Plans for Retirement Planning:At present, the interest rates in the market are high, which are likely to come down in the future. In such a situation, this is the perfect opportunity to invest your retirement fund deposited under the National Pension System (NPS) for regular income. If you buy an annuity at the current rates and lock your fund at these high rates, then it can be a profitable deal for you. Because by doing this, the current high rates will be fixed for your entire life and you will be able to get better regular income. Even if the interest rates fall in the future, you will continue to get regular income at the already fixed rate. Policy holders taking Joint Life Annuity Plan can also arrange fixed income at these rates for their spouse after themselves.
What will be the monthly income on an investment of 50 lakhs
At present, all the major Annuity Service Providers (ASP), including LIC, HDFC Life, SBI Life, are giving returns of about 7% or more to those who buy annuity through investment in NPS. These rates are for plans with Return of Purchase Price (ROP). On the other hand, investing in plans without ROP can also give 8% or more annual interest. That is, this is a great opportunity to lock in high interest rates and secure regular income in the future.You can check the current interest rates of the top 10 Annuity Service Providers (ASP) here. These include interest rates for both types of plans with and without Return of Purchase Price (ROP). We will also tell you how much regular income you will get every month if you invest Rs 50 lakh in buying annuity at the current rates.
Also read: 5 Star Rated ELSS: Top ELSS funds with 5 star rating multiplied the money 3 to 5 times in 5 years, gave up to 250% absolute return on SIP
Top 10 Annuity Rates (With ROP)
1. IndiaFirst Life Insurance Co. Ltd
– Annual interest rate: 7.04%
Monthly income on investment of Rs 50 lakh: Rs 29,345.09
2.MAX Life Insurance Co.Ltd
– Annual interest rate: 7.02%
Monthly income on investment of Rs 50 lakh: Rs 29,244
3. Bajaj Allianz Life Insurance Co. Ltd
– Annual interest rate: 6.99%
Monthly income on investment of Rs 50 lakh: Rs 29,133.88
4. ICICI Prudential Life Insurance Co. Ltd
– Annual interest rate: 6.98%
Monthly income on investment of Rs 50 lakh: Rs 29,092
Also read: Value Mutual Fund: Made money more than three times in 5 years, what is the funda of top 10 value funds?
5. Aditya Birla Sun Life Insurance Co. Ltd
– Annual interest rate: 6.81%
Monthly income on investment of Rs 50 lakh: Rs 28,367
6. Life Insurance Corporation of India (LIC)
– Annual interest rate: 6.66%
Monthly income on investment of Rs 50 lakh: Rs 27,761
7. Kotak Mahindra Life Insurance Co. Ltd
– Annual interest rate: 6.50%
Monthly income on investment of Rs 50 lakh: Rs 27,068
8.SBI Life Insurance Co. Ltd
– Annual interest rate: 6.33%
Monthly income on investment of Rs 50 lakh: Rs 26,388
9. Star Union Dai-ichi Life Insurance Co. Ltd
– Annual interest rate: 6.30%
Monthly income on investment of Rs 50 lakh: Rs 26,223
10. PNB Metlife India Insurance Co. Ltd
– Annual interest rate: 6.18%
Monthly income on investment of Rs 50 lakh: Rs 25,755.87
Also read: This scheme of LIC MF gave 60% profit in 1 year, 6 more dividend yield funds also gave up to 53% return, what is the secret of success
Top 10 Annuity Rates (Without ROP)
1. Shriram Life Insurance Co. Ltd
– Annual interest rate: 8.32%
Monthly income on investment of Rs 50 lakh: Rs 34,653
2.MAX Life Insurance Co. Ltd
– Annual interest rate: 8.21%
Monthly income on investment of Rs 50 lakh: Rs 34,192
3. HDFC Life Insurance Co. Ltd
– Annual interest rate: 8.04%
Monthly income on investment of Rs 50 lakh: Rs 33,502
4. Life Insurance Corporation of India (LIC)
– Annual interest rate: 7.98%
Monthly income on investment of Rs 50 lakh: Rs 33,255
5. IndiaFirst Life Insurance Co. Ltd
– Annual interest rate: 7.93%
Monthly income on investment of Rs 50 lakh: Rs 33,033.62
6. Star Union Dai-ichi Life Insurance Co. Ltd
– Annual interest rate: 7.68%
Monthly income on investment of Rs 50 lakh: Rs 31,971
7. Kotak Mahindra Life Insurance Co. Ltd
– Annual interest rate: 7.50%
Monthly income on investment of Rs 50 lakh: Rs 31,230
8.SBI Life Insurance Co. Ltd
– Annual interest rate: 7.14%
Monthly income on investment of Rs 50 lakh: Rs 29,739
9. PNB Metlife India Insurance Co. Ltd
– Annual interest rate: 7.04%
Monthly income on investment of Rs 50 lakh: Rs 29,329.77
10. Aditya Birla Sun Life Insurance Co. Ltd
– Annual interest rate: 7.8%
Monthly income on investment of Rs 50 lakh: Rs 32,504
(Source : NSDL Website)
Also read: Mutual Fund SIP: PSU funds investing in government companies are the stars, up to 49% profit on SIP in 5 years
How many types of annuity are there
1. Single Life Annuity:This scheme provides lifetime income to the policy holder, but the income stops after his death.
2. Joint Life Annuity:In this, after the death of the policy holder, his/her spouse also continues to get income for life.
3. Return of Purchase Price (ROP):In this, after the death of the policy holder, the entire amount invested by him is returned to his nominee. In a policy without ROP, only annuity is available, the invested amount is not returned.
Tax benefits in annuity plans
Investing in annuity plans gives you a tax exemption of up to Rs 1.5 lakh under Section 80CCC. However, the income from annuity is taxable as per your income tax slab, so proper planning is important.
For whom are annuity plans right?
Annuity plans are the best option for those who want regular income after retirement. Once you invest in these plans, the interest rate remains fixed and you get guaranteed income for life. This eliminates reinvestment risk and protects you from falling interest rates.
(Disclaimer: The purpose of this article is only to provide information, not to recommend investment. Take any investment decision only after consulting your investment advisor.)
