Current Update : (10-02-2004)The below review was written earlier. In 2004, another avtaar of the same Plan was launched viz. Nirvana PLUS Pension Policy which provides for 10% guranteed addition every 5 years and a built in 1 Lakh Critical Illness Cover (6 illness)for the first 3 years of the Policy and a built in double accident cover too. The earlier Nirvana is also concurrently valid.
We are fast approaching the end of this fiscal year and the prime objective at present is to finalise our tax returns and juggle the figures to arrive at the minimum tax payable figure.
Most of us have already exhausted all possible tax saving avenues like sec.80C and have parked sizable funds in PPF and NSS and RBI Bonds among others. But there is this one small miniscule section that gets overlooked at many a time and can help us save a maximum of Rs.3000/- from the Tax man.
This is sec.80CCC which allows for a 30% tax rebate on a maximum investment of Rs.10, 000/- in a calendar year in any Pension Plan. Which translates to Rs.3000/- savings in tax outgo.
Everybody must be very familiar with the ICICI Pension Plan that has been advertised so regularly since the past month or so. But there is one more choice available in the market today which comes from TATA-AIG and is called the ’Nirvana’ Pension Plan. They may have not advertised it as aggressively as their competitors but then the TATA’s have always followed the conservative but secure path. Never the flamboyant approach-which is why I place my trust on the TATA name.
The Unique feature which convinced me was the guaranteed addition of 10% of sum assured at the end of 10 years of this plan being in force. Which actually means that Rs.10, 000/- is added to your maturity amount after paying a minimum of 10 yearly premiums(example based on a sum assured of Rs.1 Lakh). This guaranteed feature is what gave me the inclination to opt for this Plan. Also, one is eligible for their Reversionary Bonus which gets added to your policy after 5 years and is compounded.
There is also a 10% Terminal Bonus which is payable upon maturity of this policy or in the event of death provided the policy has been in force for at least 10 years. But these two are only based on the performance of the company and are not guaranteed.
One can also attach various riders like the Critical Illness, Accident, and term riders for enhanced protection along with compulsory regular savings and most important TAX savings !
You have an option to choose your own retirement age from anywhere between 50 to 65 years. The minimum sum assured is Rs.50, 000/- with no upper limit. The maturity benefits are available to you tax fee. 25% is given to you lump sum and 75% you can choose to invest in any annuity of your choice at time of maturity at the best interest rate available for a period of your choice.
I think one should plan for ones own retirement early to reap a bountifull harvest and regular pension for old age.
Experience has taught me, that it is never too early to Insure, but it is always too late by the time you realize its significance.