It is necessary to invest from now on for later expenses. With the right retirement planning, you will be able to sleep peacefully when the salary of salary in your bank account will stop coming every month. However, achieving this goal is not an easy task. Especially when there is a trend of reduction in interest rate. The RBI did not reduce the repo rate in the August Monetary Policy. However, this year he has reduced the repo rate by 1 percent i.e. 100 basis points. This has also reduced the interest rate of fixed savings products.
Meaning of annuity plan
Many people for retirement post Annuity plan Invest in There is a guaranteed regular income after retirement on regular contribution in this plan. For payment, you can select monthly, quarter or annual option. It can continue till the payout fixed period or continues throughout life. Its choice can be invested.
No change in interest rate after purchasing
When the interest rate is decreasing then the real benefit of the annuity plan is visible. The reason for this is that Regular Income is guaranteed in this plan. The interest rate that is there while purchasing an annuity plan is locked forever. This means that once you buy an annuity plan, there will be no change in its interest rate later. The difference between increasing interest rate and decreasing will not make that plan.
Benefits in investment before interest rate revise
If the company that offers the annuity plan revises its interest rate between the decreasing interest rate, then the opportunity to invest in the plan (annuity) at the attractive interest rate is over. This means that it is prudent to invest in this plan before revising the interest rate of the company offering the annuity plan.
What should you do?
Investing in the annuity plan at a higher interest rate means that the interest rate of your plan will remain high. Therefore, earlier companies should reduce the interest rate of annuity plan, it would be prudent to invest in this plan.