Retirement Insurance Companies - Keeping the Promises

A great and to be trusted insurance company listens to consumers, understands their needs and responds with a range of tailored policies. The company's agents should communicate and brand each product so that prospective policy holders fully understand their workings and benefits.

Settling claims promptly is vital to insurers' credibility. The best of this type of company out there must paid out benefits totaling to a large amount of money in a very easy and easy to follow process. This is a proof of an insurance company's stability and sound financial management. Financial companies like these should maintain a substantial presence in the market so as to remain the industry leader. They must have the widest network of branches and offices, the most agents and a product for everyone regardless of age, status and financial capabilities.

As life expectancies increase and more people are living well beyond the usual retirement age, Retirement Insurance Company  that you must entertain, should tailor their products accordingly, that is to what is needed by the people. Insurance companies' offerings should include at least some of the following: lifetime insurance coverage, cash benefits, tailored to different life stages, retirement income and a full range of health care products.

These organizations should focused on retirement, health and investment solutions. Looking ahead, these type of companies should predict that demand for retirement and health care security solutions will drive the sector's future development. These are just some of the facts and some of the things that you should consider when looking for the best insurance company out there.

There are many things that you must look for in such an organization and the things mentioned above like the services and products that they are offering are just a few of them.

Try and research the company background - who are the board of trusties, did they had any bad (or good) publicity, when was the institution started and other things.

Knowing these information will make you feel secure and confident that your money is going somewhere and you will not be afraid of any unfortunate happenings like bankruptcy among the rest.

I hope the article above helped you in some way about these financial and health institution. These are just a few and very basic things. If you need to know more, I encourage you to do a Google search. There are many more information you can check out.

Source: http://ezinearticles.com/?Insurance-Companies---Keeping-The-Promises&id=5267813 

What to Do With Your Life Insurance Policy When You Retire

Life insurance is very important when you have a family who depends on you for financial support. The policy's benefit can be used to cover funeral costs, college tuition, mortgage loans and other daily expenses.

If you have made it to retirement, life insurance shouldn't be a priority. If you do not have children who depend on you for financial support, to continue paying for life insurance isn't that necessary.

If you have term coverage, it is best to let the policy expire. You shouldn't stop paying the premiums; just wait for the expiration date. Your agent will try to convince you to buy extra coverage or renew the policy. You shouldn't rush. Take a few days and think if you really need coverage. Is your family in financial difficulties, do you want to give a college education to your nephews? But most importantly, can you afford it? If the answer to both questions is yes, then extend the policy. Otherwise, just let it expire and save your money.

In the case of a whole life insurance policy, you should allow the cash value to grow. However, the premiums can be a financial strain, but the policy's account can help you pay for your coverage. From a certain age, permanent life insurance becomes self-sustaining. The policy's dividends are not taxed. The benefit is also tax-free, which can turn out to be an efficient way of leaving an inheritance to one of your relatives.

Since you kept the policy active for a couple of years, your dividends can be enough to pay out the premiums. This means that you will get life insurance for free, allowing you to keep up a positive cash flow.

A permanent policy doesn't pay out the cash value to your beneficiaries. When you are retired, it is the perfect moment to borrow against you policy and to cash in on your savings. However, remember not to overextend yourself. Borrowing against your policy shouldn't exceed the cash value remaining. If you can't afford to continue paying the premiums and decide to cancel the policy, you will have to pay back what you have borrowed at a high interest rate.

To close, life insurance can be profitable, even during retirement, but as you age, you have to make adjustments to your policy. Do not settle all your life for the same coverage, even if you do not need it. If a policy is of no more use to you, go ahead and cancel it!

Guaranteed life insurance for over 65 years old seniors can help cover your funeral expenses and other small debts and mortgage loans. and compare the best  Retirement Insurance Policy available.

Source: http://ezinearticles.com/?What-to-Do-With-Your-Life-Insurance-Policy-When-You-Retire&id=7541238

What is the Retirement Plan Company?

This is a company that works from every end of financial planning in providing retirement plan services. The Retirement Plan Company works with financial consultants, companies, sponsor and others to development company retirement plans. Retirement is an important matter to be considered by each and every individual and The Retirement Plan Company helps people give it the consideration it deserves.

Where Did it Start?

The Retirement Plan Company was established in 1992 with the objective of providing services to companies developing a retirement plan. The company gives professional guidance and instruction through the use of modern programs and technology to help companies create retirement plans for their employees. The company gives ongoing support to their clients, giving them the benefit of their expertise in financial and retirement planning.

While using cutting edge technology and Internet convenience, the Retirement Plan Company has not lost sight of the value of a personal touch. They keep person to person contact via online chat services so they can give their clients the personal attention they need.

Help from the Professionals

Expert advisors are on hand to give the benefit of their financial education and background to help companies develop their retirement plans. These experts keep their finger on the pulse of the changing financial world and are therefore able to give timely direction on a variety of financial matters.

Their mutual funds include nearly 1,000 diverse funds and they adapt their plans to meet the needs of a variety of investors and their circumstances. They have coupled with individual TPAs to offer more diversity than many other companies in their field.

Retirement is the time of life to enjoy the fruits of your hard labor over many years. During your retirement you should not have to be overly preoccupied with financial matters. In order to have that type of worry free retirement a good plan now is imperative. Concentrating now on a good retirement plan will make for the enjoyment of the kind of retirement you deserve. That is why Retirement Plan Company planning is an important part of everyone's financial plan.

Don't leave such an important time of life to chance. There is much that can be done right now to ensure that you are able to enjoy the lifestyle you always dreamed of during your retirement years. To make sure that happens, take advantage of the professional guidance and help available today. By doing this you are sure to have an enjoyment retirement in the future. 

Source: http://ezinearticles.com/?What-is-the-Retirement-Plan-Company?&id=1877240

How to Choose a Pension Plan for Retirement Planning

Retirement planning is a critical financial responsibility that every individual owes to himself and his loved ones. Those who ignore it, have much to rue later when they outlive the money supply in the bank. With increase in life expectancy and escalating cost of living and healthcare, retirement planning must be taken up on priority.

Here are 10 tips for buying a retirement plan

Earlier the better – Retirement planning must begin early on. How early? Right from the time, you draw your first cheque, set aside some money for a rainy day. Over time as your salary/income increases, hike the contributions.

Equities are important – Studies have proved that over time, equities can add significant value to the portfolio compared to other assets like fixed deposits, bonds, gold and property. So when you are planning for retirement, make sure equities are part of your plan. This could be in the form of unit-linked pension plans or equity funds or stocks.

Think diversification – Equities are good, but so are fixed deposits, bonds and gold. Wait, aren’t we contradicting the previous point where we said equities work harder than other assets. True, but that is not to say equities will solve all your problems. You need a portfolio with equities in it along with other assets like fixed deposits and gold. All these assets need to be in a particular weightage or allocation. Together they form a portfolio that can help you achieve post-retirement aspirations.

PPF will not be enough – Many individuals go into retirement planning with an auto pilot mindset. They contribute money towards options like PPF (public provident fund) or EPF (employee’s provident fund) and believe they are set to retire in comfort. This is far from the truth, these options are at best one of the avenues we discussed earlier (remember equities, fixed deposits, bonds, gold). There is more to be done in terms of building a portfolio than just PPF. PPF or EPF won’t even be enough to fight inflation. Picture this – if long-term inflation is at 6% and the PPF rate is 8.5%, that’s a mere 2.5% (8.5%-6.0%) net of inflation. Imagine you go into PPF thinking you will make Rs 85 on every Rs 1,000 and you end up making Rs 25 on every Rs 1,000 because inflation stole the rest of the money from you.

Vesting age –Go for pension plan with a vesting age that matches your needs. There are some pension plans with vesting age starting at 40 years. So if you want an income stream that early on in life, go for such a plan. On the other hand, there are plans with vesting age at 85 years, which is suitable if you plan to retire late.

Higher sum assured - Go for a Retirement Pension Plan that gives out higher of sum assured on vesting and accrued bonuses or assured benefit.

Assured death benefit – Prefer a plan with a minimum payment on death – for e.g. 100% of reimbursement of premiums.

A suitable annuity option– Opt for a pension plan with the annuity options most suited to you – for e.g. the lifetime option guarantees annuity for a certain number of years regardless of whether policyholder survives or not, the joint life/last survivor annuity gives out pension till the individual is alive, post which his spouse receives the pension.

Expenses – Go for options where charges / expenses are competitive. Remember the more money you lose towards expenses, the less you save towards retirement. This calls for a comparison of expenses across options to identify the most cost-effective one.

Financial planner –Retirement planning is serious business. It is serious enough for you to commit money towards it. And it is serious enough for you to consider engaging an experienced and competent financial planner who can handhold you through the retirement planning and execution process.

Retirement Insurance Policy

Click here  https://www.bajajallianzlife.com/retirement-plans/retirement-plans.jsp For more Retirement Pension Plan are aimed at helping you save & invest systematically to build a retirement corpus that helps you retain your lifestyle.

Make Retirement The Best Phase In Life – Plan Now !

Retirement is a chapter that proposes a new charter of life to a person and is a conversion from a lifetime of work towards relaxation. It is that period of time when a retired person gets to enjoy his/her life and exist in the small pleasures of life which was always left on the back burner. “Life begins at retirement”- a true statement, However, to maintain oneself during this period without having to rely on someone and to live life on one’s own terms and conditions, one needs to plan beforehand and this planning requires the individual to put savings into retirement plans for getting economical coverage and enjoyment in the post retirement stage of their life.

A good retirement policy makes sure that the insured and his/her family will receive a regular income as pension and it also provides facility of choosing the retirement age and date as well in which one receives the pension amount.

Below are the some key things that you must keep in mind while capitalizing for the retirement plans:

Buy an insurance plan at an early age to get more benefits for post-retirement years

Retirement age is known as the time period when a person decides to end the build-up phase of money and move towards the phase of capitalizing on the cash build-up. It is vital to understand that you must choose the plan which can meet your requirements for the future and the cost of the premium that you would be able to easily afford.

You should consider the rising costs of health treatment or an unplanned  vacations that you may undertake during that period before selecting a retirement plan. Hence it is vital to think about the manner of pension income that you will get based upon your lifestyle requirements.

Types of Retirement Plans

Usually in India the basic types of retirement plans that are offered by the insurers are the one in which the insured will get fixed returns as stated by the insurance company along with the minimal deviation. On the other hand, there are some plans in which the funds would be invested in debt or equity by the insurer. In the latter case, the returns depend upon the market trends. Based on these facts you can choose from any of the below mentioned retirement policies available in India-

Deferred Annuity Plans: in this you will pay the premium for certain years while you are working and would receive the pension amount after retirement.

Immediate Annuity Plan: it is one of the best policies for those who have lump-sum cash. Under this, you will get pension right from the day of payment.

Pension plans or Retirement Insurance Policy are most suitable for senior citizens of the family. It provides stability to the insured in a financial and emotional manner. With a good plan, you don’t need to compromise for the good things in life and wouldn’t have to rely on others for meeting your basic needs. Pension plan provide double benefits as it insures you and gives a fixed pension amount after your retirement. But before choosing a pension plan you need to do some research on the products that are available in the market.

It is advisable for you to get free quotes on retirement plans online and compare them with similar products available on the different online web aggregator sites. By doing a comparison, you will get a good policy that can meet your requirements at an affordable cost. Don’t just go for a reduced premium but check out all the features of the plan. There are many online insurers that are providing retirement plans and insurance web aggregators that may assist you in doing the calculation which is essential for choosing a good retirement plan. Retirement Insurance Policy.

Source: https://www.policyx.com/blogs/make-retirement-the-best-phase-in-life-plan-now/

Understand How To Secure Your Old Age?

The quality of your lifestyle at your retirement age very much depends upon how you utilize your money in your earning years. The earlier you start saving, the better is your amount of investment and superior is your purchasing power during those sunset years.

Leverage the simplicity and insurance element

If you want to be self-sufficient while you are retired, you have to plan and choose the best way to save for the future now. You can acquire a land or a property for leasing, put your money in equity related funds, buy debentures and mutual funds or choose to deposit a part of your earnings with the bank for a fixed number of years. Nonetheless, if you want protection element embedded in your retirement savings plan, you can choose to buy a pension plan. Pension plans not only provide a financial stability but also a security in old age. Buying pension plans online can also be a convenient way of going through the terms and conditions of the policy online.

The best thing about pension plan is, it is not intricate like other investment sources and you have the liberty to choose the amount of your savings as well as what you want to receive as pension. But before this you need to understand the various types of pension plans.

Types of pension plans

Pension plans are also called as annuity plans. If we categorize broadly, you can choose either endowment/traditional or unit-linked plan. Annuity plans can be further classified on the basis of time period for which the insured receives the pension in form of regular income, as:

Deferred Annuity Plan: This is the pension plan that defers or postpones the receipt of pension for a fixed time period defined by the insured, which is up to the limit of retirement age. Till that time, the insured keeps on paying the premium or installments to only make the annuity reserve grow.

Immediate Annuity Plan: In this plan, the insured needs to put the lump sum amount once at the initial phase and then he is eligible to receive regular pension income immediately.

Annuity Certain: This is the plan that lets the insured to receive the pension for fixed number of years as defined by him in his policy at the time of acquirement.

Lifetime annuity: This plan provides pension to the insured for the life time. In case of insured’s death, the nominee is entitled to receive the total premium amount along with the bonuses accrued on it.

Guaranteed period annuity: The insured gets a fixed income for a particular period after the retirement, however in case of an eventuality his nominee is entitled to receive the compensation. In case the insured is able to survive, annuities are paid to him for the lifetime.

Joint life/ last survivor annuity: This plan allows regular income to the insured. In case of his demise, the joint life or the retirement planuse is entitled to receive the annuities for the lifetime.

You Money can be defined as the power to spend which enables you to acquire the lifestyle of your choice. Now it depends on how you utilize your power and invest it in credible sources. It is never too late or too early to save and plan for the old age. So that you are actually independent in your older years, do not think any more instead compare and buy best Retirement Pension Plan now.

The most important part of any insurance buying process is comparison. Comparing insurance policies online is the most recommended practice and websites like policy.com provide such detailed comparison of plans provided by various insurers.

Source: https://www.policyx.com/blogs/how-would-you-choose-to-spend-your-retired-life/    

Policy changes for small employer retirement plans

Broad adoption of workplace savings plans for small employers may require policy changes that encourage small businesses to give their employees the opportunity to save for their future.

What can we do to solve this problem? Here are five ideas that Empower Retirement believes can help with this important goal:

1.       Develop a simplified starter 401(k). Small businesses operate very differently from their mid- and large-market counterparts. They don’t have the same resources to manage a workplace savings plan, but they should have access to a simpler solution that removes administrative burdens. This starts with eliminating expensive and time-consuming testing and limiting in-service withdrawals, which reduce the amount of savings available at retirement. This could ease plan administration and keep the plan healthy by minimizing asset reduction.

2.       Expand underutilized startup tax credits and make the credits refundable. Small businesses take time to get off the ground. Profitability, which may be minimal during the early years, eliminates the value of a nonrefundable credit. Additionally, the uptake rate of the current credits is low — approximately a half-million dollars annually.3 We have to increase these tax credits to improve uptake.

3.       Increase availability of multiple-employer plans. Small businesses have limited access to the multiple-employer plan (MEP) system. This is due to the Department of Labor’s stance that there must be some commonality among MEP sponsors. Under current IRS rules, a disqualifying event by a single sponsor can disqualify the entire MEP.  This further discourages adoption.

4.       Establish designated plan providers to oversee administration of MEPs. A designated plan provider (DPP) could assume many of the fiduciary responsibilities to eliminate concerns and fears small businesses have related to this role. The creation of DPPs would also encourage Retirement Fund service providers to fully engage in this market.

5.       Create a regulatory environment that encourages plan adoption and maintenance. Small businesses need a simple, limited-liability correction process that doesn’t result in overly punitive penalties or unwarranted windfalls to participants. Policy makers need to remove the administrative burden associated with termination and asset distribution of abandoned plans. Providers should be able to streamline, consolidate and deliver required notices in a manner that leverages evolving technologies.

Retirement service providers and policymakers should work in partnership to ensure that all working Americans have access to an employer-sponsored savings plan. Any one of the proposed ideas could help more employers provide a retirement plan for their workers. These ideas can also help us bridge the retirement access gap.

Source: http://blog.empower-retirement.com/five-policy-fixes-to-help-small-employer-retirement-plans/  

Let your retirement be a new start to your new life

Venkatesh, a resident of Bangalore, was shocked when he enquired the price of flowers during the festive season, a few weeks ago. He was asked to pay Rs 50 for a small quantity! What surprised Venkatesh was the fact he could afford to buy same flowers for a cost of Rs 0.50 (yes, you read it right) less than a decade ago. For a man preparing for a retired life 10-15 years from now, this was worrying news.

In fact, retirement as a concept should get its due share of respect and time has come for all of us to put our mind on the subject. Not only because the price of goods and services we buy will keep increasing but also because we have to pay for them even when we don’t have the luxury of salary income. With life expectancy steadily increasing over the years, many of us may end up having a post-retirement life which could be equal to our working years!

While the above scenario may look scary, the good news is that we also have products which help us to tide over the challenging phase. The perfect example is pension plan which ensures steady flow of regular income as long as the investor is alive.

How does a pension plan work?

As the name indicates, the objective of the product is to provide pension income to the investor during his life for which he makes contributions during his income (earning) years. As a result, one should start looking at the pension plan at the earliest as longer the tenure, larger would be the corpus. At the end of the premium paying term, the customer has the option of withdrawing 1/3 of the corpus amount and choose to receive annuity or receive pension for the rest of his life.

Needless to say, an investor who thinks about Retirement Pension Plan at the age of 25 can afford to invest as little as Rs 20,000 per annum as he has the luxury of contributing for a period of 25-30 years. On the other hand, an investor who thinks about retirement at the age of 45 does not have the same luxury as he may not be able to work for 25 years due to various reasons. Hence, he may have to shell out a minimum of Rs 2 lakh per annum to manage his post-retirement life.

In fact, financial goal is an important aspect of retirement planning as the amount saved during working life should take care of the needs of the investor when he does not save. So, the best way to go about is to arrive at the cost of living at current level. Then factor in inflation over the long term which will be equivalent to the current expenditure. As you observed earlier in the case of flowers, the cost does not remain the same. Through pension plan, the problem of inflation will be tackled as the money saved during working life grows over a period of time.

One of the arguments against pension plans is that why go for a pension scheme when an investor can invest in various other products like equity schemes or fixed deposits and manage on his own. The answer is simple. Pension scheme is the only product which ensures regular income without the hassles of money management. In the case of pension plan, an investor needs to only invest during his income years. After the end of the term or when he requires pension, the company takes up the responsibility of paying pension as long as the investor is alive. No other product ensures such facility. This should prompt all of us to sign up for the pension plan.

Key factors of a pension plan

·         Start investing in a pension plan at the earliest. Every delay means less pension income in the long term.

·         Pension contribution is a long term commitment and hence avoid discontinuance

·         Sign up for a pension plan in line with your long term needs. It should ideally be part of your overall financial planning.

·         Check if your pension plan allows flexibility in terms of top-up facility, annuity options, etc

·         Contributions to a pension plan come under Section 80C. It can be part of your overall tax planning.  

Source: http://www.exidelife.in/knowledge-centre/blogs-and-articles/retire-on-your-own  

Why Should I Buy Insurance Before 25?

Yeah, young age does that to us. Gives us wings, a hope that time lasts forever and it will be a long time before the end comes and that becomes our biggest nemesis! Not only that, when we are young we tend to forget how the body behaves, since it has always been healthy and growing and showing signs of immortality. It’s only after we start to age in our late 30’s or early 40’s when we realise that we are not that active or healthy anymore like we were in the prime of our youth! By then it becomes late as far as our planning for a health coverage plan or life insurance is concerned.

The best time to start thinking about old age and sickness is when you still can, in a rational and stable state of mind. That time is when you’re pretty young, and logically speaking, there is a lot of practical benefit to it as well. The reason you should take a call for the insurance investments before you turn 25 has a lot to do with commercial benefits that you can’t avail at a later age.

An important aspect while buying insurance should be to consider lifelong renewal. This way you can stay covered and enjoy the insurance benefits throughout your life without paying hefty premiums or worrying too much about the costs of treatments.

It is only one life and it is mandatory to plan it in a way that not only it benefits you, but also your family members. Not only should it make things easier for you, it also takes away the stress from you, of thinking about the medical costs in case something unforeseen happens.

Do make such decision when you’re really young, so that even if insurance money is not utilized for medial or after-death benefits, after maturity of the policy, the money can be used for retirement purposes. 

Retirement Plan Company  investing early would mean the companies can offer you a wide variety of coverage plans, which are not available for older people. This would mean more options for you to think about that can take care of not only your life insurance needs, but also health insurance plans that cover diseases associated with age.

Keep your retirement income goals in mind

The purpose of a retirement plan is to replace income in retirement. If you’re still thinking about your retirement plan in terms of accumulated assets you might be more likely to have a negative reaction to market declines. It would be understandably frightening to see, for example, a 5 or 10% drop in your balance. You might even be tempted to take action and assume that by doing so you’ll reduce losses.

However, if you’re thinking about your retirement plan in terms of the monthly income you’ll receive in retirement, then market corrections are going to seem less impactful. The effect of even a large market move on your monthly paycheck in retirement is going to seem insignificant if you’re planning for the long term. If one develops that monthly retirement income mentality it’s a great way to diminish any fears and will help prevent making emotional investing decisions.

Develop a plan to help guide you through turbulent markets

Hopefully, you’ve got an advisor with whom you’ve developed a retirement plan that’s aligned with your goals. If you don’t, research from the Lifetime Income Score V4 shows that the value of advice is significant. It’s critical that in times of market volatility you stick with that plan and don’t let unexpected market turns force you off the path unnecessarily.

With a high degree of certainty, I can say that you and your advisor did not develop a plan that required you to panic when the markets become volatile. Your plan does not instruct you to react with emotion when markets decline. Stick to your guns and stay the course. Your advisor knows how to build a retirement plan and you ought to have confidence in it.

Market timing does not pay

Part of the reason you should be in an advisor relationship is to help keep you in the market at the right time and in the right investment vehicles to help keep your savings working for you. It’s certainly tempting to think that by exiting the market you’ll avoid losses and be able to re-enter the market at the right time. There is a lot of research5 that’s been done to show that attempts to time the market are very difficult to successfully execute.

Check in with your advisor

If you have concerns, now is a good time to talk to your advisor. See what he or she is thinking about the current market environment, ask questions and discuss whatever concerns you may have. The conversation alone may provide with Retirement Plan Company assurances you need. If the current market environment is exposing flaws in your strategy or revealing that you may not have the risk tolerance you originally thought you had then, by all means, work with your advisor to make a change. But more often than not, your next step is to do nothing, stay the course and keep on saving toward your goals.

Insurance Plans Provide Guaranteed Income For Post Retirement Life

Indian people have an instant requirement for a financial product which gives long-term stability and can provide them an guaranteed income source during post-retirement years. Most people are not secured with any type of pension plans. Therefore, they are dependent on their own income or need a help from their working children. They do not accumulate enough money to use it as a support for themselves at the stage of retirement. So, they face some serious slipping possibility into poverty once they are retired.

The overall situation does look like a scary dream, but you can overcome very easily if you begin early planning for retirement as well as start investing for long periods to benefit from the power of compounding returns to make a rough retirement corpus.

Working people needs to focus on an income needed to continue their current standard of lifestyle and offer support for expensive medical costs in post-retirement years. Then, buyers would reach at a monthly allocation which requires to be prepare from their current earnings to get an ideal retirement corpus and benefit from an uninterrupted flow of income during post retirement years to continue the current lifestyle.

Many insurance companies provide a wide range of best pension plans that can go long way in targeting the post-retirement issues of current working population. All these schemes have a long-term orientation when it comes to investing the premiums with a goal to make a flow of annual income through a good combination of non-guaranteed and guaranteed cash payments.

Insurance cover gives a  strength to handle the risk of a sudden death of the insured person with brave heart and a choice to customize the insurance by selecting from a bundle of riders for additional security to minimize the financial impact of various major threats to the livelihood of the policyholder because of serious illness.

These schemes plan lifetime security along with guaranteed lifetime annual income. Plus, these products are one of the best ways for generating an annual income till death, it works really well when customers buy the same for their child. Once buyer pays premiums for a certain period, his child enjoys a guaranteed income every year along with insurance cover for whole life.

These pension schemes offers a neatly-structured schemes for post-retirement years and offer a discipline to regularly invest in the best retirement plans. These products would empower a policyholder to hold a charge of funding their golden years and enjoy financial independence once they retire.

Along with good health, a sustainable income on retirement is also important for a secure retired life.

Is Life Insurance a Retirement Investment?

Sometimes it seems the insurance industry believes that buying a life insurance policy in one form or another is a cure for any financial ill. To be clear, life insurance is a part of many properly constructed financial plans. Many of us need to provide this protection for our families in the event of an untimely death. Parents, and anyone who provides support for someone else, might consider life insurance protection.

Life insurance can also be used for estate planning purposes or as a vehicle to ensure that a business can continue to operate in the event of the death of an owner or key employee.

My beef, however, is with life insurance marketed as an investment, most often as a retirement investment vehicle. To say the life insurance folks are inventive and creative marketers is an understatement.

A typical scenario

Life insurance is often marketed to high-earning professionals and business owners as a means to put away additional funds for retirement over and above any type of retirement plan they might already have, such as a 401(k).

The pitch is this: buy a policy with underlying investment vehicles that will build cash value over time. The client funds the policy for certain number of years and the growth in the cash value will eventually negate the need for additional premiums. At retirement the client can withdraw cash as a tax-free loan for retirement. The loans never need to be repaid and the only consequence is a reduced death benefit.

Consider alternatives

If you are pitched a plan to use life insurance as a Retirement Insurance Policy make sure that you have reviewed and exhausted all other alternatives first, including:

Fully funding a qualified retirement plan including a 401(k) or SEP-IRA.

Starting a pension plan for yourself. This includes a cash balance plan.

Funding a low-cost, no-load variable annuity.

Even if you find that this life insurance strategy is the best course of action make sure that you shop policies and companies. You will want to look at the quality of the underlying investment and understand all underlying fees and expenses.

If you buy a policy, make sure that you continue to monitor it. Set aside money to fund it, watch the performance of its underlying investments, and be sure withdrawals won’t a trigger a tax penalty?

Life insurance can help provide financial security for your family. However, if you buy it for any reason other than the death benefit, make sure that the policy fills the alternative role in the best possible fashion before writing your first premium check.

Five policy fixes to help small employers with retirement plans

Policy changes for small employer retirement plans

Broad adoption of workplace savings plans for small employers may require policy changes that encourage small businesses to give their employees the opportunity to save for their future.

What can we do to solve this problem? Here are five ideas that Empower Retirement believes can help with this important goal:

Develop a simplified starter 401(k). Small businesses operate very differently from their mid- and large-market counterparts. They don’t have the same resources to manage a workplace savings plan, but they should have access to a simpler solution that removes administrative burdens. This starts with eliminating expensive and time-consuming testing and limiting in-service withdrawals, which reduce the amount of savings available at retirement. This could ease plan administration and keep the plan healthy by minimizing asset reduction.

Expand underutilized startup tax credits and make the credits refundable. Small businesses take time to get off the ground. Profitability, which may be minimal during the early years, eliminates the value of a nonrefundable credit. Additionally, the uptake rate of the current credits is low — approximately a half-million dollars annually.3 we have to increase these tax credits to improve uptake.

Increase availability of multiple-employer plans. Small businesses have limited access to the multiple-employer plan (MEP) system. This is due to the Department of Labor’s stance that there must be some commonality among MEP sponsors. Under current IRS rules, a disqualifying event by a single sponsor can disqualify the entire MEP.  This further discourages adoption.

Establish designated plan providers to oversee administration of MEPs. A designated plan provider (DPP) could assume many of the fiduciary responsibilities to eliminate concerns and fears small businesses have related to this role. The creation of DPPs would also encourage retirement service providers to fully engage in this market.

Create a regulatory environment that encourages plan adoption and maintenance. Small businesses need a simple, limited-liability correction process that doesn’t result in overly punitive penalties or unwarranted windfalls to participants. Policy makers need to remove the administrative burden associated with termination and asset distribution of abandoned plans. Providers should be able to streamline, consolidate and deliver required notices in a manner that leverages evolving technologies.

Retirement Insurance Company service providers and policymakers should work in partnership to ensure that all working Americans have access to an employer-sponsored savings plan. Any one of the proposed ideas could help more employers provide a retirement plan for their workers.

Source: http://retirementplansinindia.tumblr.com/post/145001841845/five-policy-fixes-to-help-small-employers-with

How Your Home Can Function as a Pension Plan for Your Retirement

Ah, the good old days of defined benefit pension plans. Pensions used to be common and a wonderful source of retirement income. But these benefits are increasingly rare. If you are feeling the stress of funding retirement, it is likely because you simply lack the guaranteed pension income that your parents probably had.  You have worked hard, but the structure of our financial systems changed and you may be feeling like you don’t have enough cash for retirement.

What is a pension and why was it so valuable?

A defined benefit plan is a type of pension in which an employer agrees to pay a specified monthly amount to the retired employee. Typically, this amount is predetermined using a formula based on the employee’s earnings history, age and tenure of service.

So someone with a pension likely had three significant sources of Retirement Insurance Company income: their pension payments, Social Security and personal savings.

How your home can be your own personal pension plan

For many people, housing wealth represents a sizable share of their overall net worth. But for retirees in particular, home equity is even more valuable.

Home equity represents more than 50 percent of net worth for the typical household over the age of 65, according to research published in the Journal of Personal Finance. As a percentage of wealth, housing commands 80 percent of total wealth for roughly 30 percent of people above the age of 62.

This is particularly good news for people who are struggling with how to pay for retirement.

If you own your home, you may be able to use your home equity to create a kind of pension for yourself.

How does reverse mortgage work as a pension replacement?

For homeowners age 62 and older, a reverse mortgage can enable you to access a portion of your home equity, which you can use to increase cash flow during retirement.

Unlike a traditional “forward” mortgage, monthly payments toward the loan balance are not required on a reverse mortgage. So rather than paying the lender each month, reverse borrowers is instead receiving funds from the lender.

The money received from a reverse mortgage is considered a loan advance, and as such, it is not subject to state or federal income taxes.  As you borrow from a reverse mortgage and receive portions of your home equity, the loan balances increases. The amount of funds borrowed must be repaid at some point. Repayment of the loan is not required until the borrower dies or otherwise vacates the home secured by the reverse mortgage loan.

Source: 

http://retirementplansinindia.tumblr.com/post/144946722040/how-your-home-can-function-as-a-pension-plan-for

Insuring your retirement is not unlike insuring your car

You can insure your home and car from disasters and accidents. Life insurance essentially protects your family from the loss of your income should tragedy strike. You can’t insure your retirement accounts in the quite same way, but there are a few tried and true strategies that can help safeguard them.

1. Save for retirement even during…retirement

There is no rule that you have to stop investing when you hit your golden years. One of the best hedges to outliving your retirement assets is to continue investing even when you reach retirement age. While there are mandatory age distributions from 401(k) retirement plans and traditional IRAs, you can continue to make investments in other assets during your retirement.

Here’s a reminder: In the last 30 years, the dollar has lost nearly 60 percent of its purchasing power to inflation. Investing offers a way to combat that loss of purchasing power by developing a plan that not only takes this into account but allows you to achieve what you want to achieve over a given time period.

2. Work longer

While some Americans must continue to work during retirement because of a lack of savings, others simply want to work and enjoy the social aspect of working during retirement.

Retirement today looks very different than it did decades ago, and that isn’t necessarily a bad thing. The real problem is getting over our preconceived notions as to what retirement means in today’s economy and society. A longer work life means continued engagement as well as continued paychecks.

However, the day you cash your last paycheck, the price of everything begins to matter. Why enter a shrinking economic reality sooner than you need to, especially if you enjoy your work.

3. Invest in passive income strategies

Truly effective retirement planning should include other income streams to supplement your retirement. For example, you could have a pension, income from real estate, Social Security and an annuity to help replace the income that you had before you retired.

The key is to save assets that produce cash flow in excess of your expenses versus amassing a pile of inert assets that will have to be converted in order to fund your retirement. In other words, looks for ways to create perpetual income, reduce or eliminate risk and treat your retirement as a “working retirement” that aligns with your lifestyle.

Retirement is a euphemism for old-age financial independence. The core of financial independence using passive investments is that you create cash flow from investments that exceed your expenses and only spend the cash flow, not the principle balance. A passive income requires minimal input from you after you invest in it to start.

4. Invest in annuities

An annuity is an insurance product. You trade a lump sum for equal monthly or yearly payments when you invest in an annuity.

For example, a $1 million lump sum payment to an insurance company could provide you with more than $40,000 in yearly payments for you and your heirs for the rest of your lives. That’s because annuities shift risks from you to the insurance company including market risk, actuarial risk and longevity risks from you to the insurance company.

5. Hedge your investments

Receiving company stock in the form of options can be an important tool for insuring your retirement. An option gives you the opportunity to sell or buy shares of stock with contracts at a future time at a set amount of money, instead of relying on the fluctuations of the market. If you don’t feel comfortable with options, you can enlist a financial planner to hedge your retirement investments.

Finally, it never hurts to get professional financial help if you are worried about your retirement accounts and if you will have enough saved for retirement. Retirement Insurance Company  do not offer retirement portfolio insurance, but there are ways that you can hedge against calamity with your retirement accounts.  

HOW TO CREATE A RETIREMENT PLAN WHICH WORKS

Some of the top questions we get from people in our financial planning sessions are as follow

1.       Why do i need a retirement plan, i have enough savings

2.       How much money do I require to live a comfortable life once i retire

3.       How do i retire as early as possible

4.       How do i retire at the age of 40

5.       I save 10 K per month, is it enough for my retirement plan

6.       What is the best way to save money and retire early in India

7.       How much money i require to maintain the same lifestyle as today once i retire

8.       What is the best retirement plan

This is first in series of posts through which I will try to  answer some of these questions , most of the advice here is tailored for Indian users

So before we get started , lets get some basic definitions out of the way

What is a retirement plan

Simply put Retirement plan is set of financial planning activities/steps you undertake to ensure financial security and a comfortable after retirement life, A good retirement plan should have all of the following

·         How much do i need for retirement

·         Where will the money come from

·         Where do i invest to get to what i need

So how do i start building a great retirement plan

·         Start right away , Its never too late , early you start you get more time to grow your money

·         Ensure you have other key financial obligations checked in your financial plan, these include but not limited to following: Emergency funds, Health Insurance, Other key goals house, Marriage, kids education , kids marriage etc.

·         Find your monthly expenses if you are not married, try to forecast your expenses post marriage

·         Take a premium on the monthly expense of around 20 %, generally you will under-estimate expenses

·         Provision for Inflation , this is the biggest elephant in the room, and the unknown devil you need to provision against, here take inflation on higher side from CPI inflation numbers you see in newspapers, thats because inflation that might impact you can be different like health, travel, leisure can have higher inflation.

·         Figure out the right asset portfolio for your retirement so that you get the best possible return, with reasonable risk

Creating a sample plan

Let say your current age is 30 years, current monthly expenses are  Rs 50,000 per month, you plan to retire at 60 years, and average life expectancy is 80 years ( so you will live till 80)

So number of working years you have are 30 , now assume that you have separately taken care of all other financial obligations like children marriage, children education, contingency etc, we will go ahead and calculate your retirement  corpus , for simplicity we will assume that inflation is 7 %, we will also assume that your annual expenses will be 80 % of your expenses today.

6 big mistake to avoid while creating a Retirement plan

·         Underestimating impact of Inflation

·         Underestimating impact of compounding, hence starting late

·         Under estimating health insurance required resulting in unplanned health related costs

·         Getting debt/equity ratio right in your retirement portfolio , right mix can take you far

·         Getting contingency funds right

·         Underestimating other financial obligations

·         Never rebalancing the plan you made, its always good to periodically review your plan

·         For more details on things to avoid in a Retirement Pension Planread my post here

So where do we go from here, well you can start with getting help on retirement planning , by creating a custom plan for your self-created by our proprietary algorithm here.

Be Financially Secure In your Old Age

The theory of evolution revolves around the cycle which consists   of various stages of life. Right from the initial stage of childhood to the last leg of old age; people tend to complete a full cycle of life. Childhood is considered to be the most carefree years of life where all your needs are catered by your family. It’s a stage of life when a person is completely dependent on others even for routine work. The next phase is the adolescent stage of life where a person pursues education and aspires to be successful in life. Then comes the final stage of life which is the old age. Old age usually tends to weaken the health and drop regular energy levels of a human. Often people tend to worry about their old age a lot. Trying to figure out their way through the old age phase, both physically and financially. If you are one of them, who usually gets worried about your old age, here is your getaway.

Invest well for your future. If you want to know how? This is your answer. Invest in pension plans for a much secure future. While in your professional employment , you can invest for a longer goal. Pension plans benefits are intangible and provided when you need them the most i.e. after your retirement. Retirement plans are simply an investment which you make through payment of fixed amount of money on fixed amount of time. These monetary transactions are known as premiums and the benefits are provided after the maturity of the policy. Best pension plans provided by insurance providers have drafted to provide maximum benefits with minimal amount of cost.

Pension plans are not just investments for the future but also a way to be financial independent at an age which demands dependency. In order to opt for the best insurance policy its important you have a detailed data of various plans available in the market. This can be done by comparing insurance plans online. Compare best pension plans in India using various insurance comparing websites such as not only provides you the detailed information about a particular pension plan but also helps in brief pension plans comparison. Comparing Pension plans online helps in providing the right direction in taking a financial investment decision. We believe when it comes to investments, think and think hard.

How Do We Make Retirement Decisions? The Psychology Behind Our Choices

We all like to think we understand why we take certain actions, but that’s not necessarily the case because of the psychology behind our decisions. Frequently, we choose actions that are based on emotion rather than facts, or we respond to even more subtle suggestions that guide our behavior. The field of behavioral finance investigates why people don’t always make the best financial decisions, like how much to save for retirement. That’s particularly important for retirement plan sponsors who want employees to make better decisions about their future. So, what does influence your employees’ decisions? Here are some of the factors:

Inertia . We often expect and even want things to continue the way they always have in the past. This inertia keeps us from making decisions that could improve our lives or even change previous decisions. For example, employees may avoid enrolling in a 401(k) plan because they never have done it before, so why start now? One way to overcome inertia is through automatic enrollment, in which employees are enrolled in the plan unless they opt out. That puts inertia on your side, since once employees are enrolled, they are less likely to make the effort to opt out.

Default bias. Many people automatically accept things that are presented to them “authoritatively.” For example, employees who enroll in a 401(k) plan might find that their employer has chosen a default contribution level of three percent. Many will simply accept that default, assuming that their employer has selected the “right” number for them. In fact, most retirement experts agree that people need to save about 15 percent of their income for retirement, so accepting the “default” can seriously impact their future. Similarly, people may react the same to employer-matching rates. If the employer matches three percent of contributions, they will “default” to that contribution. Employers should be aware of this bias and use to it help employees. Setting higher defaults for contributions and matching will encourage employees to increase those amounts.

Indecision . Too many options can paralyze people. After all, people struggle to pick from a dinner menu, and choosing investments is much more important than choosing appetizers. Trying to select from 20 or more investment options in a Retirement Plan Company confuses people, who choose poorly or refuse to choose at all. For example, a participant who is forced to choose among a large number of options may simply elect to put his or her contributions into Investment A, which may not offer enough growth to meet retirement needs. Retirement plan sponsors can address this by limiting the number of investment options.

Build your strategy around your participants’ behaviors

As retirement plan sponsors, we rely on behavioral finance to understand why your participants make certain decisions and how you can structure your plan to turn these psychological weaknesses (and many others) into strengths. We’d be happy to review your plan and suggest changes you can make to help your employees reach a successful retirement.

Give your retirement a priority

Most of us push back the very thought of retirement and give it the least preference in one’s scheme of things in life. A retirement survey shows nearly 78 percent of Indians haven’t planned their retirement. But then, ignore it at your own peril. With increasing life expectancy and rising cost of living, can you expect to maintain the same lifestyle you are used to now, leave aside enhancing it? Act now, before its too late. Sit down and design your retired years with lots of traveling, spending, and relaxing in mountains and beaches, all through your retired years. You should plan in a way that you are never short of funds even during the retired years and certainly not dependent on anyone including your children.

 Start Early, Start Now

 And to achieve that comfortably, you need money. If you are one of those who haven’t started saving towards retirement, planning it is simple especially if you start early. The earlier one begins to save for retirement, the lesser is what is required. See, how Radhika had to save considerably less than others to create same corpus in “Starting Early: Compounding at its Best”.

 Small Start to Big Corpus

 Small amounts, if invested wisely and with discipline, could end up as a healthy sum when you retire. There are fund houses with schemes that ask for as low as Rs. 500 to start with. Start now, as it helps building a financial discipline. Start with a smaller amount and over time when income rises, increase your savings. Saving a few thousand rupees every month doesn’t require much of an effort, so devise a plan and stick to it. Putting aside 10 per cent of take-home cheque in a retirement basket shouldn’t hurt. It’s seen that launching a retirement program when you are 55 is 18 times more expensive than when you are 25.

Compounding Magic

Even if you are starting late, you probably need to re-look the magic of compounding. Simply put, under compounding, your savings would multiply exponentially as interest earns interest over long term.  If you start investing early, the time you give your earnings to earn further is more.

The Vehicle

 Once you decide to make regular investments towards your Retirement Pension Plan, be sure to exploit the full potential of equities as it has delivered the most among all asset classes in the past. Equity mutual funds have proved to be the ideal vehicle for retail investors to take advantage of the excellent long-term growth of stock markets.

Many of us procrastinate and do not give importance to retirement until they are 40 plus. They have a misplaced confidence that they could manage from a late start. Their perception is that a little extra amount of savings would be enough. The reality is, starting late could make you invest more than double than someone starting early. More the number of years to retirement, more is the boost to your retirement corpus!

Source: http://www.bajajcapital.com/blog/Give-your-retirement-a-priority.aspx     

How to choose an effective retirement insurance company

Life is all about racing hard. Whether it is day-to-day activity, schooling, career, job, married life responsibility or even old age; we all want to win the competition in the end. It is a never ending race. But over the period of time as we gradually grow old at some point we all are going to retire from the working life phase. A break will be put on our race and it might directly shift into the first gear of life where things have to be taken care off in more relaxed and conscious manner. Be it a business man or a salaried professional our regular flow of income will come to a halt and we will have to look back at the savings that we have build over the years. So, everyone needs a sufficient retirement plan that will help them survive their old age and fulfill their incomplete dreams in life.

Each one has its own way of securing their olden days; the best way to create a qualified retirement plan is to approach the professional financial planners. A qualified professional have loads of knowledge and experience over the years and they can guide you properly for creating a well-balanced plan. It is the lack of knowledge due to which most of the people fail to formulate a good retirement plan.

Today, markets are pooled with loads of retirement products catering to the clients across the nation, but the one plan which allows you to save systematically and build up the much needed lump sum to provide yourself a regular income after your retirement is “retirement insurance plans”. In these plans, a person pays fixed amount, known as the premium, to the insurance company over a pre-determined period of time, known as the term of the policy. While part of it goes for insurance cover the rest is invested in various instruments to earn returns and build a corpus over the term of the policy. Investors who would like to maximize their returns can consider using a combination of aggressive, debt-oriented and hybrid funds along with the plans of insurers for the purposes of earning a pension. 

Now that you aware of retirement insurance concept you must be looking out for the best company to finalize a retirement plan? It is advisable when you search for a retirement insurance company or a professional to finalize your plan first make sure that the company or the person has healthy experience in planning retirement. You should try to know how they strategize, finance for your retirement and on what equity, debt or balanced funds do they recommend to invest. They should be well-versed with financial knowledge and counter the losses if any, in your funds to give you balanced results in the end.

A well reputed retirement insurance company will do everything on right note, but still you need to look into certain aspects of the company. The first thing you should look is the client base of the company and how good is the relationship with their client. If possible try to get feedback from the existing clients or try calling up customer service and understand how friendly and proactive the team is. Are they able to mitigate your concern on time? Apart, from this you should also look into the general suggestion they make on the issues like financial planning, planning for set interval of time and more.

Once you finalize the company or the individual you should make sure that they formulate a clear strategy and are putting out plan that will maximize the return on your investment. Keep a regular updated on the entire move Retirement Fund makes and the planning they do on maximizing your investment. Before finalizing the plan make them aware of your personal financial commitment towards your family and the financial strength or capacity that you can invest for. This will help them formulate a financial plan in a way that it does not affect your present situation and also helps you to invest in your future, this kind of balanced investments are very much important.

To get a basic idea you can also use a bit of internet too. Today, online sites are a great place to start as they help you easily to compare the cost of insurance and also let you get a glimpse on retirement insurance company reputation in the markets. If you can’t afford to devote your valuable time on research then you can entrust the job to a well known insurance agents. It is one of the reliable ways to ensure that you get best insurance quotes in less time without having to go through the hassle and tedious task calculations.