Most pension plans may have a maximum entry age of 55 or 60

Most pension plans may have a maximum entry age of 55 or 60
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First Published: Mon, Mar 24 2008. 12 30 AM IST

Updated: Mon, Mar 24 2008. 12 30 AM IST
The insurance business in India isn’t just growing, but also becoming more sophisticated in terms of product offerings. To help readers keep ahead of developments in this business, Mint features a Q&A on insurance every Monday.
I am a 25-year-old man working with a software firm. I want to invest money in a savings instrument, preferably in a unit linked insurance plan (Ulip) or a mutual fund. What should I go for?
Ulips combine protection with market-led investment returns. Mutual funds and unit linked plans are both very different products and address different customer
needs. While Ulips are close to mutual funds in terms of functioning and structure, their first and foremost purpose of insurance is protection.
The value that insurance provides cannot be underestimated. As a means of protection, life insurance provides benefits that no other investment plan can offer because, ultimately, it helps provide peace of mind to a family.
The decision to invest in either a mutual fund or a Ulip should depend on the time period of your investment, your financial goals and your risk-taking appetite.
I am 50 years old and work in a private sector company. Do you think it is too late for me to invest in a pension fund? What is the right age to invest?
India lacks a well-defined social security system. So, a vast majority of us are left to fend for ourselves post-retirement. It is advisable to start saving for retirement as early as possible, as the basic objective of a pension plan is to help you plan your finances, so you are not dependent on anyone once you quit work. To answer your question, most insurance companies may offer pension plans with the maximum entry age of 55 or 60. Hence, you could be eligible to buy a pension plan. You can start saving in a pension fund even now, though the amount you have to keep aside for a significant corpus may be high as you may be working for another 10-15 years only.
Readers are welcome to write in with their queries to askmint@livemint.com. The questions will be answered by senior executives from leading insurance firms.This week’s expert is Rajesh Relan, managing director, MetLife.
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First Published: Mon, Mar 24 2008. 12 30 AM IST