Key Takeaways
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When the new year of 2025 dawned with hope and enthusiasm, little did we know that the world would soon come to a standstill. Covid-19 opened our eyes to reality with its lockdown and an unexpected economic slowdown.
It is times like these that actually make you feel proud of the safe investments you made, and which have continued to grow and yield benefits. If you haven’t already, this is your sign to realise the importance of saving plans and make smart investments now!
The best savings plans offer much more than just the steady growth of investment.
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Tax saving is one of the most important and unique features of these savings plans. The best plans will offer tax savings in all the following situations:
Investment amount deductible from taxable income under section 80C
Tax-free maturity value/ death benefit
Invest any amount without losing the tax-free status of the maturity amount
Guaranteed savings plans from life insurance companies offer all three tax-exemption statuses to your money. Thus, if you choose to use one of these plans to save for your goal, the maturityvalue could be entirely tax-free.
One factor you will need to keep in mind is that if you want to avail tax benefits under Section 10(10D), your premium should not exceed 10% of the life cover. This is applicable for plans bought before April 1, 2012. For plans bought on or after April 1, 2013, the premium amount should not exceed 15% of the total value of the plan.
For example, if you want to accumulate ₹50 lakhs, the guaranteed saving plan will accept ₹50 lakhs as the base life cover and decide your premium. All you need to do is make sure that the annual premium in any financial year is not more than ₹5 lakhs if your plan was bought after April 2012 or above ₹7.5 lakhs if you invested in it after April 1, 2013.
Also, you cannot voluntarily invest more than ₹5 lakhs or ₹7.5 lakhs in the plan in any financial year. If you do so, the maturity value of your investment will become taxable.
The best savings plan in the market are the ones that offer guaranteed returns. Meaning, you know the minimum amount you will get upon maturity at the beginning of the investment. This makes it very easy to plan for important life goals using these plans.
For example, you want to accumulate ₹50 lakhs for your child’s higher education in 20 years. You can invest about ₹13,000 per month for the next 10 years, to receive ₹50 lakhs in 20 years.
Since the returns are guaranteed, all you need to worry about is completing your investments for the next 10 years. Also, since you also have a similar amount of life cover in the plan, your family will receive the money even in case of your premature demise.
ULIP maturity benefits are taxed at 10% as LTCG if the annual premium is above ₹2.5 lakh, but death proceeds remain tax-free.
Source: India Today
The guaranteed sum is only the minimum assured return. Wealth boosters, as the name suggests, enhance your portfolio value over time. These are regular bonuses that add to your plan as long as you stay invested. Longer-term investments naturally accumulate higher bonuses.
Guaranteed Assured Income Plan by Canara HSBC Life Insurance add bonuses to your investment plan, boosting your overall maturity value. The plan offers two bonuses to all investors:
Guaranteed yearly additions (annual bonuses)
Guaranteed loyalty additions (based on policy term, larger bonus for the longer term)
Thus, not only can you be sure to receive the minimum sum at maturity of the plan, chances are you will receive a lot more than the guaranteed sum.
So, as we wanted to accumulate ₹50 lakhs in our previous example and we had to invest ₹13,000 per month for 10 years. With wealth boosters, your monthly investments will drop to about ₹5,500 per month.
Goal protection or premium protection is another unique feature of the guaranteed savings plan. This feature means that even if you meet the ultimate fate before completing your investment in the plan, your family will meet the goal.
To understand this unique benefit, consider this example:
In the previous example, we had a goal of funding a child’s higher education with ₹50 lakhs in 20 years. To achieve this goal, you need to invest ₹5,500 per month in the guaranteed savings plan for the next 10 years.
Now, if you opt for a goal protection option, the insurer will cover your premium payments as well as the normal life cover. Without this option, in case of your demise in the 5th policy year, your family would receive ₹50 lakhs plus any bonuses, and the policy will discontinue.
However, with the goal with protection option, the insurer will deposit the remaining five years’ premium on your behalf, after paying the death claim of ₹50 lakhs. The plan continues even after the death claim, and the family will receive the maturity value with all the accumulated bonuses at 20 years’ maturity.
Investment flexibility allows you to invest in a way that is most convenient for you. For example, if you are salaried, you would like to invest every month, while business professionals may prefer a quarterly or annual mode of investment.
Also, you have multiple goals in life, and if possible, you would like to invest in different goals at different times. The limited pay option of the guaranteed savings plan gives you the flexibility of investing in the plan for a limited period.
This is also useful since the plan will accept only a level premium, and as your income grows, you will be better off investing a larger sum every month.
With these many features, selecting the best savings plan should not be a difficult choice. So, start investing and stop worrying about the turbulent times.
So, now you know that to deal with uncertainty that can strike at any moment, securing your future with a reliable savings plan is no longer optional; it is essential. The best savings plans in 2025 go beyond just wealth accumulation; they offer a powerful combination of tax benefits, guaranteed returns, and life protection that align perfectly with your life goals. Whether you are planning for your child’s education, a dream home, or a financially secure retirement, these plans provide the peace of mind and financial discipline needed to get there. Start today, and let your money work smarter for a safer, stress-free tomorrow.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
Canara HSBC Life Insurance offers online ULIP plans that blend life insurance protection with investment growth, helping you build wealth while securing your family's future.
