Traditionally, men have been the primary earners and investors in India. But, nowadays, women are also stepping up and taking over the family responsibility eloquently and have been actively looking for investment options. Today, there are many investment schemes that cater to women’s savings needs. These schemes are designed to encourage women to actively invest, save and secure their future.
In this blog, we discuss the benefits of a guaranteed savings plan and why every woman must have it in their financial portfolio.
- Get financial independence
Financial independence is critical for all, especially for women. By investing a small amount periodically in a savings plan throughout your working years, you can contribute to the welfare of your family. Besides, having your own savings makes you feel more financially independent and confident to accomplish your life goals.
For example, if you want to purchase a home in your favourite city or send your child overseas for studies, your investments and savings will allow you to dream big and make those dreams a reality.
- Retirement fund
Retirement is inevitable. When you become old and have no regular income source, you may start depending on your children or other family members to take care of your everyday needs. However, if you invest in a savings plan, you can accumulate enough wealth over a period to take care of your own expenses during the golden years of your life.
- Get life insurance coverage
Perhaps one of the most significant benefits of a savings plan in your portfolio is that it allows you to get life insurance coverage along with savings opportunity. This means while you continue to save for your future and accumulate wealth, you can be assured that if something happens to you, your family’s financial future is secure. They will never face financial hardship as they can use the death benefit to meet their needs.
Besides, you can also extend the scope of your life insurance policy by purchasing riders at an extra premium. For example, if you have a family history of critical ailment, you can buy a critical illness rider to get protection against such life-threatening conditions. If you are diagnosed with such a condition, the insurer will immediately provide a lump sum amount to help you take care of the hospitalisation expenses.
- Assured returns
A savings plan is one of the safest investment options for all women. Not only does it guarantee the safety of your capital, but it also gives you assured returns each year. You get returns in the form of an annual loyalty bonus and guaranteed yearly additions, which increase your overall maturity pay out.
- Tax benefits
As a prudent investor, you would want to ensure that you get maximum tax benefits, right? Well, investing in a guaranteed savings plan is a great way to reduce your overall annual tax liability. Since the savings plans come under the life insurance umbrella, the amount you invest is eligible for tax benefits.
You can enjoy tax deductions up to Rs. 1.5 lakhs under Section 80C of the Indian Income Tax Act, 1961. So, as you continue to save and invest towards your future, you also get to reduce your annual tax burden through the investment period. In addition, the death and maturity benefit you or your family receives is tax-exempt.
Please note – the tax benefits on ULIP are applicable only until 31st March 2023. As per the announcements made in Union Budget 2023, the premium you pay for ULIP will be considered for taxation purposes.
Now that you know the benefits of investing in a savings plan make sure to add it to your financial portfolio and take a confident step towards a secure and financially independent future.