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Pension Plans- Select The Bank

About Pension Plans

What are pension plans and why are they needed? The answer in some form or other might be known to each one of us but at Money Super Bazaar we are committed to give you the best possible and a comprehensive answer. That is what we are going to do here. Let us talk about pension plans, pension planning and kind of pension plans India has to offer.

Pension plans are special plans provided by insurance companies to make your life after retirement comfortable, relaxing and stress free. Once you are retired from your usual working life, the only financial cushion is the pension you get by the employer or the pension plans you had bought as part of the retirement planning. Pension planning is an important exercise one must indulge during the days when he or she is still employed. Pension planning is all about planning the after retirement life. In fact, pension planning takes precedence over lot of other things when you are employed with an organization which doesn't has any sort of retirement benefits like a retirement pension plan. For example, many companies in the private sector do not provide any benefits like pension to its employees and hence pension planning is your own prerogative.

For pension plans India is a big market and has shown a huge growth potential. The primary reason for this is the country's ever growing population and a big section of that population is the middle working class. When there is no surety of life in old age, a retirement pension plan does the trick. For pension plans India insurance companies are today offering lot of options to choose from. When planning a retirement pension plan, you can do your own calculations using a pension plan calculator. A pension plan calculator is something which you can use to know how much to invest at what age to get your desired amount after retirement. Most companies offering pension plans also provide a pension plan calculator which you can use to decide on the right retirement pension plan. You just need to provide the required inputs like date of birth, desired retirement benefits etc. to the pension plan calculator and get the monthly premium need to be paid.

Another type of retirement pension plan is the defined benefit pension plan. A defined benefit pension plan is the one in which the benefit amount which the employer has to pay to its employee is well defined and known in advance. The monthly benefit in a defined benefit pension plan is calculated based on certain formula and rules. You can also calculate your benefit amount for a defined benefit pension plan using a pension plan calculator. However, in the wide range of pension plans India is aware of, a defined benefit pension plan is not yet a known entity. Mostly the employer provided pension plans India is known for do not tell you in advance about the monthly amount you will be entitled for after retirement.

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