I
had worked in a MNC for 16 plus years and as part of the retirement
benefits, required by law they had provided us with a Superannuation
Plan where in 15% of Basic pay was contributed monthly basis and a
simple interest of 8% was given added to the corpus after payable on
a half yearly basis and was added to the corpus. This benefits was
applicable only after a select grade onwards. As part of work
service of 16 years and the Superannuation contribution would have
closely covered around 8+ years of contribution. This accumulation
until my resignation accumulated to a value over 15 lakhs.
As
per the Government norms we can withdraw 1/3 of the contribution when
we resign from our job and the remaining amount or Rs/10 lakhs was
used as a one time payment to buy an annuity Scheme, LIC policy of
Pension Scheme.
Now,
after my resignation from the organization and the relieving date of
12-0ct-2018. My Account was deposited with 1/3 of the total value at
the time of Resignation Rs. 5 lakhs plus and I started to received
Rs. 5,715 as pension for the rest of the contribution amount to Rs.
10 Lakhs.
Now,
after my resignation I also deposited or created a fixed deposit with
HDFC Bank for an amount of Rs 5 Lakhs with an annual interest rate of
7.3% and the interest for the same is Rs. 36,500 per annum and works
out to be Rs. 3041.67 per month.
If
the interest rate is above 7% or more for fixed deposit tenure then
it is wise for us to invest the corpus in a FD rather than buying a
superannuation policy.
What’s
does an insurance or superannuation policy provide?
It
provides us protection from risk, post retirement monthly payment and
continuity of payment to the Nominees and return of corpus as per the
option selected by the Employee at the time of retirement.
Now,
if we know to manage the amount ourself with FD and savings better.
We only need a term insurance coverage that needs to be bought by us
very early in our life and a health insurance coverage for us.
This
would mean the Capital of Rs. 10 lakhs would be with us and the
interest amount would gives us the monthly payment or annual payment
as per the FD instruction.
Therefore,
plan your insurance needs early in your life. Buy term insurance and
Health insurance coverage only rest of the scheme is not required
rather focus on your Savings, Fixed deposits to retain cash in your
account.
The
superannuation scheme is as useful as any other scheme but you need
to choose right option at the time of filing your form during
resignation. The contributions from your CTC by the Employer to the
Employee Superannuation fund.
Hence,
my advise would be to be very careful in options you select for such
schemes. Better think of investing in PPF, SSA, SIP, SIFD, RD and
FDs along with Term insurance, Health Insurance, Travel or accident
coverage insurance, Property Insurance to cover safety, risk...
Please
understand insurance is not savings scheme rather covers a particular
type of risk involved always buy insurance for Risks associated with
the Scheme and not for savings, returns, investment.
In
my superannuation schemes lack this basic principle of not returning
the capital amount invested by the Resigned or Retired Employee that
would mean the capital is lost only interest is given.
The
Superannuation policy has an option to recover the corpus after the
death of Last Annuitant in this case the corpus would returned to the
nominess and hence be aware of this options.
Life
Pension with provision of 100% pension to Spouse on Death of
Annuitant with ROC to Neminee on Death of Last Annuitant
Pension
/ Annuity will be continued during the both Life Time of the Emloyee
and his / her spouse and after the Death of the Last Survivor, the
Corpus / Purchase Value will be refunded to the third Beneficiary /
Nominee of the Employee, by the LIC, INDIA
Same
pension will be continued during spouse's life time also
Corpous
will be paid by LICI to the Beneficiary (s) after the death of the
Last Survivor .
Hence
my suggestion is that we all need to carefully when we select our
options when provided at the time of resignation or at the time of
opening a policy. The Decision are taken once and the option to
change or rectify is not a choice we can adopt hence we should be
very careful on what option we select.
#SuperAnnuation,
#FixedDeposits, #Insurance, #SavingsandRetirementPlan <br>
#"Karthikeyan
Karuppanan"
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