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Top 7 Features of a Savings Plan For Women

dateKnowledge Centre Team dateDecember 08, 2020 views209 Views
Top 7 Features of a Savings Plan For Women

Indian women always have been the ones who quietly kept putting aside small amounts for the family’s future needs. They continue to do so even when without a direct income. More often this small saving is as a kitty for emergencies or the family’s needs but rarely for herself.

Men have been the primary earners and investors, traditionally, but women are taking up the baton fast. That means the investment options have also evolved to cater to the needs of this new age investor.

If you are also looking for investment options to safely park your savings and enjoy long-term growth, here’s a two-step process to help you:

  • Understand the reasons for investments (define investment objectives)
  • List the features you need in the ideal investment option

Reasons for Investment or Types of Financial Goals

1. Financial Independence

Financial independence is important for any adult, and so it is for women as well. It allows you to contribute to the welfare of your family as well as to the society directly. With your savings and wealth, you can implement your ideas and lead your life more independently.

You may have certain goals in life, for example, buying a house or sending your child to Ivy League colleges or career-building hobby. Your investments will also enable you to achieve more financial goals for your child, family and, more importantly, for yourself.

2. Retirement Fund

Retirement savings are important for everyone. As this is one stage which you cannot avoid in life. Having enough wealth to take care of your expenses in this stage is crucial for you, more so if you are a woman.

Women tend to live longer than men so they have to ensure that they have enough to take care of themselves till the end.

3. Learn About Investment & Insurance

When you manage your money yourself, you gain valuable experience with the financial market and investment options. This experience will help you manage your money and your family’s wealth better in future.

Such knowledge is extremely useful in case of emergencies when you suddenly become the primary member of the family. For example, in the case of sudden hospitalization, accident or death of the spouse.

Your investments too should help you take care of such situations financially.

So with all these factors, you need specific saving plans. Following are the key features you will need in a good savings plan for yourself:

4. Easy to Manage Online

The current environment has limited our stepping out and hence the saving plan should be such that one should be able to manage it online without having travel anywhere. These days most investments can also be managed through apps.

5. Small Monthly Outlays

Taking huge investments are good but with uncertain times it is prudent to plan such that it should give you the flexibility of managing it through small outlays without causing major strain on your monthly home budgets. A 20-30% is an ideal savings outlay per month.

6. Automate the Investment

Many of us have acquired the habit of savings through the way our families bought us up. But sometimes we lack the time and end up missing the instalments.

Savings should never be out of what is left as balance after allocation of all monthly expenses. But it should be along with all other allocations and only then can you develop a serious attitude towards it.

If your savings plan allows for auto-debit, you can set up a date and your investment will continue whether you remember or not.

7. Safety of Returns

One always needs a Savings plan that will ensure that the principal doesn’t get eroded through the years. Unless you are comfortable with aggressive market-linked investments, you need such investment where your money can stay safe.

Safe investments will let you focus on your profession and family, while your money grows steadily.

8. Goal Protection Option

You already have plenty of financial goals, some of which are very important for your family. If you are saving to meet these goals, wouldn’t it be great if your savings plan can offer to protect the goal from any mishaps?

Few safe investment plans such as Guaranteed Savings Plan from Canara HSBC OBC Life offer goal protection option. This plan offers to cover for your goal in the case of your early demise.

Upon the death of the investor, the investment part of the plan continues as if you are still alive and investing in it.

At maturity, your family will receive the sum you intended for them in the beginning. Thus, not only safeguarding your invested money but also the ultimate objective of your investment.

9. Provides a Life Cover

Even if you have put aside your career and now managing your household full time, your contribution to the family can be quantified. In your absence the family will have to bank on the alternative services which will cost them, affecting their wealth.

Thus, if your savings plan can provide your family with a lump sum in your absence, you will also keep them financially safe.

Women, often are covered under Mediclaim floater policies but lack adequate cover for critical illnesses. One should look for such contingencies through the Savings Plan. The guaranteed savings plan will provide a lump sum to your family immediately upon your death.

10. Tax Benefits

The ideal savings plans must also make for good tax-saving instruments. The guaranteed savings plan from Canara HSBC OBC Life is a life insurance plan. Meaning all the investments in the plan will help you save tax. The invested money is tax-deductible up to Rs. 1.5 lakhs under section 80c of the Indian Income Tax Act, 1961.

Maturity and death benefits of the savings plan are also tax-exempt under section 10(10D). Thus, once you start investing in this plan you can set aside your worries about tax liabilities from this investment.

The market is flooded with several saving investment plans, and every plan has its risks associated with it. With the varying risk-return profile of all investment options, putting your savings in ad hoc investment is not a good idea.

Select an investment plan which not only caters to your future financial needs but also makes your life easier now.

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Frequently Asked Questions

What is saving plan?

A savings plan is likely to be different for everyone depending on the financial goal, risk profile, returns, and investment horizon. If you are young and want to save for your retirement, ULIPs like Invest 4G or Titanium Plus plan would be the best option. You are likely to create a large corpus by your retirement through market-linked returns if you invest in this savings plan. If capital protection is your aim, then traditional insurance plans such as Guaranteed Money Saving Plan should be suitable for you.

Who should invest in a Savings Plan?

If you are looking for a guaranteed income plan, then saving plans should be on your list of investments that you are planning to make. Savings plan require you to invest a pre-decided amount on a regular basis. People with a regular stream of income who require a lump-sum amount after a period should opt for a savings plan. Working professionals, self-employed people and businessmen should consider a savings plan to meet their long-term financial obligations. Saving plans are also ideal for people who are risk-averse and want to accumulate funds through relatively safer mediums. These saving plans inculcate financial discipline in policyholders which make them crucial for every portfolio.

How much money should you put in savings each month?

The amount that should be invested in a savings plan each month depends on the income, existing financial obligations and the long-term financial goal. If you have a steady income, you should save at least 20% of your monthly income. It is not necessary to invest your entire money into a savings scheme as investments should be diversified. Ideally, you should aim to have a financial buffer of over 10 times of your annual income. Choose an income plan based on your financial circumstances to stay afloat.

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What is the difference between saving and investing?

Saving is the money that you keep aside for emergencies or for buying any big-ticket item. Investing means growing or multiplying the wealth that you have by buying savings plan, or any other assets. Buying a savings plan will help you in achieving your investment goals such as retirement, your child’s higher education or marriage, or for buying a new house.

Which savings plan is best for retirement?

The Invest 4G plan with its multiple investment options and various portfolio management strategies for capital protection is an ideal saving plan for retirement. Also, Guaranteed Income4Life is also another savings plan that you can consider for building your retirement corpus as it acts as a guaranteed income plan that will provide you maturity benefits to manage your post-retirement expenses.

Which savings plan is best for long-term goals?

Smart Goals Plan is a savings plan with its unique features such as modification of the sum assured partial withdrawal and fund switch can help you plan for your long-term financial goals. Canara HSBC Oriental Bank of Commerce Life Insurance offers a wide variety of saving plans that you can invest in as per your risk appetite and investment goal.

Which savings plan is suitable for girl child?

The Future Smart unit-linked plan from Canara HSBC Oriental Bank of Commerce Life Insurance is the ideal savings plan for the girl child. Monthly Income Advantage Plans are also a good option if you are planning to invest in a savings plan for your girl child.

Where should I invest my money?

You should spread your investments across financial instruments. However, having the best savings cum guaranteed income plan in your portfolio is extremely important. Savings plan ensures financial stability and also helps in fulfilling short, medium and long-term monetary goals.

What is a monthly income advantage plan?

A monthly income advantage plan ensures that you lead a stress-free life with your loved ones as it provides a life cover along with giving you guaranteed monthly income. In short, it is a life insurance and income plan that will financially secure commitments made to your loved ones. Canara HSBC Oriental Bank of Commerce Life Insurance Guaranteed Income Advantage Plan is a monthly income advantage plan that provides life cover for the entire term while you pay premium only for a limited period.

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What is a good age to start saving money?

When you plan to invest in a financial product, it always pays well to start early. The earlier you start saving and investing, the better. When you start investing early, the capital gets adequate time multiply. Even a small amount invested for a long time can give substantial returns due to compounding in a savings plan. Invest in an income plan as early as possible to build a significant corpus that will later help you in life. Ensure that you buy the best saving plan in India that can be aligned with your investment goals.

Should you use a savings plan for retirement planning?

Yes. Retirement planning is one of the most important financial decisions of our lives. The best saving plan offers a host of features that may help you build your retirement corpus. Some of the saving plans like Guaranteed Income4Life offer guaranteed returns at policy maturity. Such returns can act as a regular income stream even after your retirement to help you stay financially stable.

Are saving plans beneficial for managing unexpected expenses?

Yes. Best saving plans in India offer partial withdrawal system that can be utilized during your rainy days. Being financially prepared to tackle such odds will help you manage any unforeseen expenses in a smooth manner. Buy a monthly income advantage plan that will generate a steady source of income for you to take care of both long-term and short-term financial goals.

How to save tax by using savings plan?

Saving plans are known for helping us achieve our financial goals. Best saving plans allow you to grow your wealth while providing life cover. Saving and investment plans are also beneficial for tax planning. Premiums of savings cum protection plans come with tax benefit under Section 80C of the Income Tax Act. Moreover, proceeds received upon the death of the policyholder or upon the maturity of the policy are tax free under Section 10 10(D).

What is the right age to start saving money?

When you plan to invest in an income plan, it always pays well to start early. The earlier you start investing in a savings plan, the better. When you start investing early, the appreciation in capital is significant. Even a small amount invested in the best saving scheme for a long time can give substantial returns due to compounding. Buy the best savings plan as soon as you start earning to achieve all your milestones on time.

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How a savings plan can help in building your child’s education fund?

Saving plans help in building wealth over time against the investments that you make. Buy the best savings plan to build an education fund for your child. The best saving plan for kids offered by Canara HSBC Oriental Bank of Commerce Life Insurance eases the stress of planning your child's future by providing a lump-sum payout on the investment. Consider investing in a monthly income advantage plan to assist you in fulfilling your financial goals.

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How Savings Plans by Canara HSBC Oriental Bank of Commerce Life Insurance can help you?

Every person has a unique reason to save and invest. With ULIP savings schemes, the company caters to people seeking wealth creation through capital appreciation. Contrarily, the traditional plans can help you save for important life goals without worrying about the fluctuation in fund value. All major savings plan offers partial withdrawal facility that can help you take care of unplanned contingencies. With savings plans from Canara HSBC Oriental Bank of Commerce Life Insurance, you get adequate flexibility while investing and receiving the savings benefits, which makes them a good investment choice for investors looking for income plans.

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