When you think about retirement, you might wonder how much money you have saved, where you’d like to live, and when you want to start. People used to think of retirement as a time to relax on the front porch, play golf, and travel. But you might not be happy with that kind of retirement. Maybe you’re having trouble putting money away and could benefit from a rigid budget. Maybe you’re worried about losing your mental agility if you stop working, but you also value the social contacts it affords.The following are the different kinds of retirement:

What is Traditional Retirement?

Most people think of a traditional retirement when you say the word “retirement.” In this case, you work for the usual amount of time, which is probably until you’re in your 60s. Then you quit your job for good. So there are no part-time or extra jobs. Rather, you sit back, take it easy, and enjoy the time off you’ve earned by working hard.

For a traditional retirement, you need to have saved up a good amount of money. Most of the time, having enough money means starting early, investing wisely, and waiting as long as possible to take Social Security. So, you will have the most money waiting for you.

Remember that the rate at which you can take money out of your retirement fund depends on how long you expect to live. A person in excellent health with no significant medical issues in his past has a fair chance of surviving into his late seventies or possibly eighties  (and beyond). So, your savings should take into account how long you and anyone else, like a spouse or children, will need the money to live on.

What is Partial Retirement?

There are some retirees who decide to keep working after their careers are over. They’re known as “partial retirees.” People who take this path usually get a part-time job with fewer responsibilities. Or they can explore a hobby they couldn’t do before.

A retiree may work for several reasons. First, money. Living a life of partial retirement helps you save more money for retirement for a longer time. Since you still have income, you don’t need to take as much from your savings. Your nest egg lives longer.

If you anticipate working after your retirement, you don’t need as much savings. That means you don’t have to be as strict with your plans to save money for retirement.

What is Temporary Retirement?

Traditional retirement and partial retirement both end your career, but temporary retirement doesn’t. People who choose this path typically only retire for brief periods of time. They work in one field or job for a long time and then take a break. It can last from a few months to a few years, based on the person and how much money they have. 

A person who takes a temporary retirement might not go back to the same job. He may go into a different role within the same industry or try something altogether different. It depends on what the person wants and what their financial goals are.

Temporary retirement has the disadvantage of necessitating intricate financial preparations. As a result, you will not be able to save as much and will likely need to begin taking withdrawals earlier than someone with a longer career.

What is Voluntary retirement?

A voluntary retirement incentive known as “voluntary retirement” is made available to staff workers who are eligible for the program and meet specific conditions. The incentive is utilised by human resources (HR) as well as management in the process of right sizing a business.

Conclusion

Overall, your personality will determine which type of retirement is best for you. If you are worried about money, you might be more likely to take a traditional path. If you want to do something different from what most people do, there are other things to think about. In general, the best retirement is one where your needs and wants are both met. If you’re worried about your current plan for retirement, you might want to talk to a financial expert, like a retirement planner or financial advisor. Your future plans can be adapted with their assistance.

If you are looking for a long-term option for generating wealth, ULIP should be the best and the most reliable option for you. ULIPs are best suited for those looking for a long-term wealth creation plan. This offers you the benefits of both, savings and protection. Popularly known as Unit Linked Insurance Plan, ULIP provides both insurance and investment. It provides life cover with good returns and also helps in saving taxes. According to the current market situation, ULIPs are considered to be the best investment options.

Reasons Why ULIPs are a better option for long-term wealth creation

• Flexibility – ULIPs are considered flexible because they help you in switching funds during your policy period. Out of all the financial tools, this is the only tool that gives you this option. It gives the option of moving the investment amount fully or partially from one fund to another to the insured. You have the option to choose any of them as per your needs or as to how your funds are performing. This includes growth, balanced, equity, and income funds.No cost is required even if you make 3-4 switches in a year. The only thing that is required from your end is, that you need to choose the policy, change its find allocation, and maintain it till your policy ends so that you are able to enjoy the long-term benefits.

• Better returns than other financial tools – The other reason why ULIP is a better option is that it provides better returns. When compared to other financial tools, it has been noticed that ULIPs invest the premium that you have paid in several asset classes which helps in getting better returns, apart from this, it also gives you the option you can opt for different funds every year according to their performance.

• Tax benefits -As per Section 80C of the Income Tax Act 1961, ULIPs also allow certain tax benefits. Certain factors are responsible for an ideal tax-saving option, such as lock-in period, maturity benefits, and amount of return. This in turn proves that ULIPs are a better option to invest in as compared to the other tools due to the benefits it offers.

Conclusion

All the above-mentioned points make it very clear why investing in ULIPs is a better option for creating long-term wealth. ULIPs maintain a perfect balance between providing insurance coverage and generating great returns. Therefore, choose wisely while investing in a financial tool.

Everybody wants the best and a luxurious lifestyle for themselves and their family. It is very important to have sufficient savings so that one can stay financially sound during uncertain times. However, keeping all the money in a savings account is not an appropriate financial decision. You can deposit your surplus amount in fixed deposits or any other financial tool.

What is a Guaranteed Savings Plan

A guaranteed Saving Plan is a non-participating plan that offers an endowment assurance at a fixed amount. As per this plan, the policyholder will have to pay the premiums for a fixed period of time. However, once the plan matures, policyholders will receive all the designed benefits of the savings plan. The policyholder gets an assured sum of all their premiums paid at the end of the plan’s term with other advantages. The additions consist of a fixed interest rate that is added each year. Along with this, the plan offers a maturity bonus as well at the end of the term. The ones who opt for a savings plan, also have the right to apply for tax benefits.

Features of a Guaranteed Savings Plan

Various features of guaranteed savings plans are as under

Premium

With a guaranteed savings plan, you can choose to pay the premium amount either altogether, or in parts. These options are provided to reduce the burden on the policyholders.

Policy Term

The policyholder can choose the term that covers their needs.

Guaranteed Maturity Benefit

Under this plan, the policyholder is assured of getting the benefits after the policy is matured. Also, the maturity benefit can be paid in case the policyholder survives after the end of the policy term.

Death Benefits

Death benefit is provided by many policy providers. The benefit is provided to the nominee in case of the sudden demise of the policyholder.

Trial Period

If the policyholder is not satisfied with the terms and conditions of the policy, then they have the right to cancel the policy and return the documents within 15 to 30 days of commencement.

Guaranteed Savings Plan vs Fixed Deposit

Factors	GSP	FD
Tenure	Ten to thirty years or even longer	One to five years
Investment	Min: ₹1000 Max: Limitless	Depends from plan to plan and generally ranges between ₹2500-₹500 per month
Returns	Monthly, quarterly, or annually	Guaranteed set of pre-determined returns
Payout	Collected funds can be invested in monthly or annual installments, or a lump sum payout of the corpus can opt for	Lumpsum payout at the end of tenure
Tax Benefits	Premiums up to ₹1.5 lakhs are exempted under Section 80C of the IT Act	No benefits generally. However, the 5-year tax-saving FD offers benefits under Section 80C of the IT Act

Conclusion

With the above-mentioned details, you can easily differentiate between FD vs endowment plan and select which plan suits you well. Fixed deposits offer a flexible tenure, on the other hand, a savings plan offers a lot of maturity benefits. Therefore, it is advisable to have a combination of investment plans for a good outcome.

A good investment strategy can help you to increase your wealth and could secure your family’s financial future. ULIPs and mutual funds are both attractive investment tools for investors looking to create wealth in the long term.

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What is a mutual fund?

A mutual fund is a financial tool wherein an AMC (asset management company) manages the money of several investors. The collected funds are then invested in different securities such as bonds, stocks, money market instruments, etc. The performance of your mutual fund scheme is directly related to the performance of these underlying securities.

Mutual funds are pooled investments that are managed by professionals who are called fund managers. It is similar to boarding a bus, wherein the driver takes all the passengers to a particular destination. In this instance, the driver is the fund manager, the bus is the mutual fund scheme, and the passengers are the investors. Fund managers are mutual fund experts who have good knowledge about the complexities and volatilities of the financial markets and make proper asset allotment decisions.

What is a unit-linked insurance plan?

A ULIP, comprises of both investment and insurance. ULIPs are insurance policies that offer an investor the potential to create wealth while simultaneously providing them with the security of a life cover.

Under ULIPs, a part of the premium goes towards providing the investor with a life insurance cover. The rest is pooled and invested in debt or equity instruments or a combination of both to help create wealth in the long term.

ULIP vs. mutual fund

	ULIP	Mutual fund
Purpose	To create wealth through investing as well as to avail a life insurance cover	To create wealth through investing
Regulatory body	Insurance Regulatory and Development Authority of India (IRDAI)	Securities and Exchange Board of India (SEBI)
policy term	Long-term	Short-term, medium-term, or long-term depending on one’s financial goals
Lock-in period	ULIPs have a lock-in period of 5 years	Most open-ended mutual funds do not have any lock-in period. A few exceptions are ELSS funds, children’s funds, retirement funds, etc.
Tax benefits	Premiums paid towards ULIPs are tax-exempt up to Rs. 1.5 lac under Section 80C of the Income Tax Act, 1961. Furthermore, the maturity amount is tax-free under Section 10(10D) of the Income Tax Act, 1961	Equity-Linked Savings Scheme (ELSS) funds qualify for a tax deduction of up to Rs 1.5 lac under Section 80C of the IT Act, 1961

Conclusion

In a nutshell, the primary aim of ULIPs is to insure the investor’s life, while the primary goal of mutual funds is wealth creation. Choose wisely, and happy investing! The information given here is neither a complete disclosure of every material fact of the Income-tax Act 1961 nor does it constitute tax or legal advice. The ones who are investing are required to review the prospectus carefully and expert professional advice with regard to specific legal, tax, and financial implications of the investment/participation in the scheme

Investment in the stock market is popular across the globe. Whether you’re keen on the share market or not, you must have come across the term “foreign portfolio investment.” It is a situation in which investors outside the country hold securities and other financial assets. However, the investor does not have direct control over the company’s assets and is relatively liquid depending on market volatility. There are a variety of assets in foreign portfolio investment, including bonds, stocks, and cash equivalents such as bonds, marketable securities, T-bills, and others. Continue reading to find more information about foreign portfolio investment (FPI).

What is Foreign Portfolio Investment (FPI)?

Foreign portfolio investments, including stocks, American depository receipts, global depository receipts, and others, are held by investors living beyond the geographical boundaries of the nation. In addition to the above assets, an individual can also invest in bonds, mutual funds, or debt issued by companies or foreign governments.

The primary goal of investing in FPI is to maximize wealth from their investments. The largest and continuously growing economies around the world receive the largest number of investments through FPI. It is quite likely that an individual investor will use an FPI to invest in opportunities accessible outside of their native country. On a bigger scale, a country’s capital account, which includes its foreign portfolio investment, is represented in its balance of payments (BOP). The BOP determines how much money travels from one country to another in a particular fiscal year.

Foreign Portfolio Investment Example

Portfolio investment generally refers to purchasing securities on the stock market. For instance, a US investor might purchase shares of a company on the Indian stock exchange. Therefore, it will be considered a foreign portfolio investment. According to the reports, investors are gaining confidence in the Indian stock market after the fast recovery from the global pandemic.

Key Features Foreign Portfolio Investment

Listed below are some of the benefits of investing in foreign portfolio investments.

• Investment in foreign portfolios will allow the investor to broaden their portfolios internationally and create the maximum return from them.
• Due to its ability to source finance in other countries, FPI can supply creditors with a sizable revenue base.
• When an investor owns a foreign portfolio investment (FPI) in a nation with a stronger currency than their own, the difference in exchange rates between the two nations may be advantageous to the investor.
• The foreign portfolio investment option is suitable for retail investors because it requires less capital than FDI and generally entails less complex legal requirements.
• Foreign portfolio investments yield returns more quickly than FDI. In essence, the investor has the freedom to sell the investments in his or her portfolio whenever they like, for the price at which that asset is currently trading.

Categories of Foreign Portfolio Investment (FPI) in India

Foreign portfolio investment in India has been classified into three primary categories that are listed below.

• Low-risk portfolio: This consists of financial resources supported by the Indian government such as government bonds, any fund held by the Indian government, a sovereign wealth fund, and others.
• Moderate-risk portfolio: An individual can invest in bank deposits, mutual funds, insurance coverage, pension funds, and other assets.
• High-risk portfolio: This includes all comparable international portfolio investments that fall outside of the first two categories. For instance, charity or endowments.

Conclusion

Foreign portfolio investments are a great source of wealth creation. An investor can buy assets from other economically growing countries and get the maximum return on their investments. Individuals, companies, and foreign governments can make investments in foreign portfolios. There are various categories among which you can choose the one that is most appropriate for you.

With a recession on the horizon, companies across the globe have started cost-cutting by laying off employees. Despite being the sole breadwinner of your family or an individual struggling to achieve their dream career goals, job loss may bring a lot of financial burdens. However, during this tough time period, a job-loss insurance policy comes as a saviour. It can keep you protected against the cyclone of financial contingencies that may happen while you are looking out for new job opportunities. Read on to find out more about job-loss insurance in India and how it is helpful if you get laid off.

What is Job-loss Insurance Policy?

Job loss insurance is a financial tool that safeguards the insurer and their loved ones if the earning member of the family loses their job. In India, an individual is eligible to claim for job loss in cases of medical conditions like critical illnesses and accidental permanent disability. Any person who wants security even when they are jobless can include a job-loss insurance policy as an add-on to their standard health insurance plan.

At present, the Rajiv Gandhi Shramik Kalyan Yojana (RGSKY) is the only plan that provides standalone job loss insurance coverage. In addition to this, the government has also been involved in providing job-loss benefits under the Atal Beema Vyakti Kalyan Yojana to individuals who have been registered under the Atal Beema Employees State Insurance Corporation (ESIC).

Key Benefits of Job-loss Insurance Cover

Salaried-income individuals always look for a job with security. Though some people manage to continue in the long run, others may face layoffs. The job-loss insurance will act like your financial buddy during this tough time. Listed below are some of the advantages of job-loss insurance.

• You have a source of income if you lose your job because of a critical illness, or any other disability.
• Upto 3 months after a job loss, the insurance company will pay for the home loan and other liabilities of the insured.
• You need not undergo any pre-medical examination to buy the plan.

What Is Not Covered Under Job-loss Insurance Policy?

Listed below are some of the exclusions under the job-loss insurance policy.

• Job loss due to poor performance, fraud, or any other illegal activity.
• The Individual himself has resigned from the company.
• Contractual or part-time jobs are not covered.
• Job loss during the policy’s waiting period is 30-90days.
• If during the probationary phase, a job was lost.

The insurer must arrange valid proof of retrenchment to find out if you are eligible to claim job loss insurance coverage.

What You Should Check Before Buying a Job Loss Insurance Cover?

Claim rejections are a nightmare, so you can avoid them by asking the insurance company the following questions:

“Am I still eligible for the claim if an employer provides severance pay?” “Will I get a claim if an employer provides a termination notice period?” And lastly, “Do I get the claim if I have been laid off but don’t have any letter or document to prove it”?

You can inquire about them directly with your insurance company, or you can read the terms and conditions mentioned in the policy document to avoid any last-minute claim rejections.

What Documents Are Required To Claim Job Loss Insurance Cover?

Here’s the list of documents required to claim job loss insurance coverage.

• Duly filled and signed claim form
• Documents justifying the cause of job loss
• Termination letter issued by the employer
• Last 3-month salary slip
• Information of employer
• ID and age proof of insured

Conclusion

Undoubtedly, job loss is a period that may bring a lot of difficulties. Job loss insurance is a great financial tool that will give you a sense of security by providing coverage for medical illnesses and paying off loans and liabilities.