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Retirement Plans

Canara HSBC Oriental Bank Of Commerce Life Insurance's retirement or pension plans help in securing your golden years so that you can continue enjoying life with the same living standard without depending on others.

Retirement Plans

Retirement Plan
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Why choose Canara HSBC Oriental Bank of Commerce Life Insurance Retirement Plan?

  • Return of Mortality Charges: An amount equal to the total of all mortality charges deducted during the policy term is returned to the policyholder at the maturity date.
  • Loyalty Additions: The plan provides loyalty additions at every 5-year interval from the initiation of the policy based on the fund value. The loyalty additions will be equal to 0.5% of the average fund value of the last 60 monthly policy anniversaries.
  • Wealth Boosters: Along with loyalty additions, the plan also offers wealth boosters based on the premium payment term.
  • Liquidity Option: To help with liquidity crunch, the policy allows partial withdrawals without surrendering the policy.
  • Settlement Option: If you do not want to withdraw the entire maturity amount in a single instance, the policy allows you to receive the amount in instalments as per the frequency chosen by you.
  • Returns are an important factor while choosing a retirement plan. Invest 4G plan has delivered 15% annualised returns helping several policyholders live a content retired life.

Our Plans

With the spread of the internet, online insurance plans and policies have gained substantial popularity. Canara HSBC Oriental Bank of Commerce offers three online insurance plans— iSelect term plan, Invest 4G ULIP and Health First plan

Invest4G

Invest4G

7 funds and 4 portfolio strategies to invest

Loyalty additions and wealth booster

Return of mortality charge on maturity under benefit option 1 (Life Option)

Flexibility of switching between the fund options to take benefits of market movements or change in risk preference

POS

Smart Lifelong Plan

Long term protection

Partial withdrawal

Auto funds rebalancing

Increase/Decrease of sum assured

Tax benefits

Secure Bhavishya

Secure Bhavishya Plan

Guaranteed maturity (Vesting) benefit

Unlimited Top-ups

Option to choose vesting age & premium payment term

Flexibile Premium Payment Modes

Loyalty Additions

Smart Monthly Income Plan

Smart Monthly Income Plan

Accumulate Lump Sum money through Annual and Final bonuses

Life Cover for 25 years

Option for loan flexibility

Get Tax Benefits#

Smart Future Income Plan

Smart Future Income Plan

Enjoy Life Cover for 25 years

Guaranteed Income and Bonuses

Option for loan flexibility

Get Tax Benefits#

Pension4life

Pension4life

Wide range of annuity options to choose from

Option to receive immediate or deferred annuity

Guaranteed lifetime income directly credited to your bank account

Option to receive regular payments for as long as you or your partner* is alive

What is a Retirement/Pension Plan?

A retirement plan or a pension plan is an umbrella term for closely related financial products. Generally, retirement plans provide dual benefits of investment and insurance cover. Individuals invest small amounts regularly in a pension plan for a long time which typically generates decent returns due to compounding. The corpus that accumulates is used to pay the investor monthly income after retirement. You have to diligently contribute to a pension scheme for a retirement plan to be successful. A pension plan can help you take care of the various expenses that crop up after retirement. Public provident funds, National Pension Scheme (NPS) and unit-linked investment plans are an example of retirement plans.

Retirement Planning Goals

Retirement planning differs from individual to individual depending on several factors such as the expected lifestyle, current income, risk tolerance and the time horizon. Begin by taking into account the lifestyle you expect to maintain after retirement. As a thumb rule, it is said that you will need 70-80% of your current annual income. You can also use online retirement planning calculators to determine the amount that would be needed by your post-retirement.

Benefits of Life Insurance:

The basic tenet of retirement planning is to have a substantial corpus after retirement. Without discipline and patience, it is not possible to accumulate a considerable amount of money. Creating a retirement requires you to contribute regularly without fail. The regular contributions lead to a habit of savings as you have to mandatorily invest in the pension plan to keep it active.

With a well-formulated retirement plan you don’t have to worry about the daily expenses after retirement. A pension plan ensures that you have a happy and fulfilling post-retirement life. A proper retirement plan not just takes care of your post-retirement life, but also makes your working life stress-free.

For a retirement plan to be effective, planning should start when one is young. Starting early has several advantages. One of the biggest advantages of planning and investing early is the low cost of financial products. Retirement plans such as ULIPs have an insurance component and the cost of insurance tends to be low when the buyer is young.

A retirement plan is a mix of insurance and investment. It provides the protection of life cover along with the multiplication of the savings component. Retirement plans range from traditional pension plans to ULIPs. The investment amount of ULIPs is invested in financial instruments such as debt and equity. The investor has the option to choose the asset class as per his/ her risk profile. The Invest 4G unit-linked plan from Canara HSBC Oriental Bank of Commerce Life Insurance provides an option to choose from seven different funds. Policyholders with higher risk tolerance and return expectation can invest in equity funds, while more conservative investors can opt for debt funds.

While the focus is rightly on the investment component of a retirement plan, the insurance portion cannot be entirely ignored. The life insurance that comes as a part of ULIPs ensures that the financial future of your loved ones is secured. The lump-sum pay-out in the event of an unfortunate event helps the family members cope up financially with the loss of a bread earning member.

3 Reasons You Need to Start Planning for Your Retirement Today

People often delay planning for retirement with the false sense of having abundant time. But the earlier one starts retirement planning the better. Here are the reasons you need to start planning today.

1.Cheaper when younger

Retirement plans offer dual benefits of insurance and investment. When you are young the body is less prone to diseases which reduces the risk for the insurer. Since insurance is a business of risk assessment, the premiums are lower for young policy buyers.

2.Compounding

When you leave an investment to accumulate for a long time, the interest earned on the original investment too starts to generate returns. This leads to rapid accumulation and the corpus grows exponentially. When you start investing early, compounding helps in multiplying the investment rapidly.

3.Course correction

All market-linked investments are inevitably risky. When you start investing early you have ample time to monitor the performance of the investment and make necessary portfolio adjustment. Canara HSBC Oriental Bank of Commerce Invest 4G plan allows investors to switch between funds without any extra cost.

Stages of Retirement Planning

Retirement planning is not a task of a few weeks, months or years. A satisfying and fulfilling life post-retirement requires years of planning and implementation. Depending on the age of the policyholder, retirement planning can be divided into three stages.

1.Accumulation

In the first stage of retirement planning, you have to contribute regularly to the pension plan. The premiums have to be carved out from your monthly income. The corpus available at your disposal after retirement will depend solely on the number of contributions made to a pension plan during the accumulation phase.

2.Preservation phase

Your expenses will change dramatically with age. The change in lifestyle fuels an increase in expenses as one nears retirement. The preservation phase kicks in 10-15 years prior to retirement. In the preservation stage, you can make a better analysis of your post-retirement requirements. Taking the required fund in an account, conduct a thorough review of existing investments.

3.Distribution Phase

The distribution phase starts when your regular income stops. This is the final phase of retirement planning when the fruits of the decades-long labour ripen. In this phase, you begin receiving monthly income from the pension plan to support your post-retirement expenses.

Principles of Retirement Planning
  • Define a goal: The post-retirement needs of every individual is different. It is important to define a goal to get started. After the goal is clear, formulate some checkpoints that would help you keep the growth of the retirement corpus on track.
  • Save and invest: Retirement planning is not a one-dimensional activity; it requires an array of investments and encompasses several goals. Before retirement, many people have to buy a house or get a child educated. These goals would need a different financial product, but the outgo will have to be divided with the retirement plan. Taking multiple factors into account, decide the time horizon of your investment for retirement planning.
  • Plan for a long life: Most people make the mistake of using outdated metrics to plan for retirement in the contemporary world. The life expectancy rate of people is rising across the world. Planning for a short retirement period can lead to exhaustion of the accumulated corpus. With the Whole Life Option of the Invest 4G plan, you can live a stress-free life as the policy remains active for the entire life.
  • Minimise taxes: Tax-efficient retirement products such as ULIPs indirectly multiply the savings. Lower tax outgo eventually adds up into the retirement corpus. You can avail double tax benefits through the Invest 4G plan. The premiums paid for the policy are eligible for deduction under Section 80C, while the maturity amount is exempted from tax under Section 10 (10D) of the Income Tax Act, 1961.
How to choose the retirement plan?
  • Start early: The earlier you start investing in ULIPs, the better as it gives ample time to the investment to multiply. As soon as you start working, start putting aside small amounts for retirement. Keep on increasing the contributions with the increase in income.
  • Equity option: Even though equities are volatile when compared to other asset classes, they generate relatively better returns. Studies have proved that equities tend to outperform other assets in the long run. Retirement plans being long-term investment products, even a small exposure to equity markets has the potential to generate significant returns. With Invest 4G ULIP, you can choose to have equity exposure ranging between 0% and 100%.
  • Option to diversify: When you are saving for something as important as retirement, it would be foolish to have disproportionately high exposure to a particular asset class. Equities generate decent returns but are also risky. Choose a plan that allows you to have exposure across asset classes. You can choose to invest in a single fund or a combination of funds through Invest 4G plan.
  • Vesting age: Choose a retirement plan with a vesting age that matches your requirements. If you plan to retire early, there are plans with vesting age starting at 40 years. On the other hand, there are plans with a vesting age of 85 years.

Factors to Consider While Buying Best Pension Plans

There are several factors to consider while buying pension plans, the primary one being the retirement goal.

1.Higher sum assured

Opt for a pension plan that offers higher sum assured on maturity.

2.Assured death benefit

A plan with maximum payment at death should be preferred.

3.Annuity option

An annuity option ensures that your corpus lasts till you live. It is important to choose a plan that has an annuity option best suited for you. There are pension plans which guarantee annuity for a certain number of years regardless of whether the policyholder survives or not.

4.Expenses

There are several expenses related to ULIPs such as fund management charges. Choose a plan that has lower administrative charges as the expenses are generally deducted from your investment. The lower will be the expenses, the higher will be the fund value.


Range of retirement plans

Retirement plans are dynamic products that ensure the financial stability of your post-retirement life. There are numerous types of retirement plans in India. Deferred Annuity, Immediate Annuity, Annuity Certain, With Cover and Without Cover Pension Plans, Guaranteed Period Annuity, Life Annuity, National Pension Scheme, Pension Funds

Retirement Planning Guide for Working Women

The 20s are the best time to start investing in a retirement plan. Start with clearing all the debt. High-interest debt such as credit card bills should be paid first. But one should not wait to clear all the debts before investing, even small investments can multiply in the long run. Saving for retirement plans starts with controlling unnecessary expenditure. Distinguish between essential and discretionary spends and channelise the additional savings into retirement policies. Planning for an event that will manifest years later is a complex task.

Related Articles Of Retirement Plan

Frequently Asked Questions (FAQs) for Life Insurance

The premium is one of the most important factors to consider before buying a policy. Many people buy a life insurance policy with a high sum assured but are unable to process the premiums for the entire premium payment tenure. You can get a better idea of the premium outgo with the Premium calculator available in the ‘Tools and Calculator’ section of www.canarahsbclife.com.

The Invest 4G plan offers three benefit options to choose from. If you have opted for the Life Option or Whole Life Option, the insurer will pay the nominee(s) death benefit if the policyholder meets with an unfortunate incident. However, in the Life Option with Premium Funding, the policy continues even after the death of the policyholder. The company pays the remaining premiums until the policy matures.

Life is unpredictable and so it is important to prepare for all eventualities. If you regularly save a substantial amount of your income for retirement, the corpus may expand to a comfortable level before retirement. In case you become disabled and are unable to contribute to the retirement plans, most plans will continue to multiply your savings. The amount already accumulated will continue to grow and besides the existing plans you can also choose to invest in pension schemes specifically designed for people with disability.

Investment in ULIPs like Invest 4G plan qualifies for tax deductions under section 80C of the income tax law. The maturity benefits of ULIPs are also tax-exempt under section 10 (10D) of the Income Tax Act, 1961. However, if the premium paid during the policy term is more than 10% of the sum assured, the maturity proceeds will be taxable.

The concept of early retirement is catching up fast in India, but there are no specified ages for early retirement. While in some western countries the age between 35 and 45 is considered favourable for early retirement, in India the ideal age is 45-50 years. With the right planning and investments, it is not very difficult to retire early.

At the age of 35-40, people generally have several responsibilities such as children’s education and various EMIs. It is difficult to spare a substantial amount of income for retirement. Depending upon the needs of the household and the lifestyle, one should aim to save around 40-50% of his/her income. Around 10% of the income should exclusively be allocated for retirement planning. Here are some tips to choose the best retirement plan.

  • Focus on your needs: It is easier to formulate a strategy when the goal is clear. Make an estimate of the amount required to sustain your life. Take inflation into account and zero in on the targeted corpus.
  • Research thoroughly: Conduct thorough research before investing in any financial product. Read the term and conditions properly and try to understand how an investment product fits your needs.
  • Consider different products: The market is awash with all kinds of investment products. Do not follow conventional advice as the need of every person is different. Take into consideration all the suitable products, conduct an objective analysis and then invest.

Owning a house is a cherished dream for many. There are several ways to save for a new house, but in urgent cases, people may be tempted to withdraw from their retirement fund. There are various financial products for retirement planning, and all have different withdrawal rules. In the case of the National Pension Scheme, partial withdrawals for special purposes like buying a house are allowed only thrice during the policy tenure. However, to avail the withdrawal facility, you should be an NPS investor for at least 10 years and you are permitted to withdraw only 25% of your contribution. If you have a PPF account, you can withdraw 50% of the accumulated amount, but only after staying invested for at least 6 years. The Invest 4G plan also allows partial withdrawals after five years of investment.

The quantum of monthly savings depends on the specific needs of the buyer. Financial advisors, however, suggest people save around 15% of the monthly income for retirement.

Retirement plans such as NPS have a very low entry threshold. It is also open to all and anyone can open an NPS account and start saving. A small business can also invest in Invest 4G plan from Canara HSBC Oriental Bank of Commerce for as low as Rs 5000 every month.

The choice between paying off a student loan or start a retirement account is not a difficult one. Starting early for retirement planning has its own advantages but extending the student loan will increase the interest burden. You will have to find a balance between the two. Try to pay off the student loan as soon as possible, but do not hold back on investing in a retirement account.

Most people nominate their spouse to receive retirement benefits in their absence. But a spouse is not automatically entitled to be the beneficiary of a retirement account owned by the other spouse.

Gold is a safe investment asset and investors often flock to the yellow metal to stabilise their portfolios. Holding a small quantity of gold can be considered as the intrinsic value of gold remains intact. You can also choose to have an exposure to gold through ULIPs. ULIP funds invest in a variety of asset classes and some fund options also have a small exposure to gold. You can choose fund options with gold to have a small and indirect investment in gold.

While there are no explicit rules barring the use of retirement account to finance real estate, it may not be advisable to do so. For instance, you are allowed to avail loan from the PPF account from the third financial year. The loan can be used to finance real estate, but it would defeat the purpose of having a dedicated retirement account.

While there are no explicit rules barring the use of retirement account to finance real estate, it may not be advisable to do so. For instance, you are allowed to avail loan from the PPF account from the third financial year. The loan can be used to finance real estate, but it would defeat the purpose of having a dedicated retirement account.

The government has allowed all central government pensioners to open a joint account with their spouses.

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