Imagine a financial product that not only promises growth but also guarantees returns, providing you with a reliable path towards your financial goals. Enter the realm of Guaranteed Return Investment Plans, where stability meets prosperity.
Guaranteed Return Investment Plans (GRIPs) are an attractive option for those looking to make a safe and secure investment. These plans offer a guaranteed return on investment (ROI) with minimal risk involved.
However, it is important to understand the risks associated with these plans and what to look out for when investing in one. This article will provide an overview of Guaranteed Return Investment Plans, their advantages and disadvantages, and what investors should consider before investing in one.
What is a Guaranteed Return Investment Plan?
Guaranteed Return Investment Plans also known as Guaranteed Savings Plans are a type of life insurance and investment product offered by insurance companies in India. These plans provide a combination of insurance coverage and guaranteed returns on the investment portion of the policy.
A Guaranteed return plan allows you to save a fixed amount regularly over a long period and ensures guaranteed returns for your future. It offers customisable return or income options tailored to your specific requirements. You contribute a regular premium or a lump sum deposit, leading to periodic payouts. In the event of an unforeseen circumstance, your family can utilize the payout for a comfortable livelihood.
These plans are well-suited for individuals who want to keep their money safe and get a guaranteed return instead of taking risks with potentially higher but uncertain returns influenced by the market. By opting for this plan, you can accumulate savings for future expenses while simultaneously providing a life cover that safeguards your family members in the event of your absence.
How Does a Guaranteed Return Investment Plan Work?
A Guaranteed return savings plan provides policyholders with a combination of life insurance coverage and guaranteed returns on their invested premiums. When policyholders opt for a guaranteed return insurance plan, they pay a premium at regular intervals usually monthly, quarterly, half-yearly or annually.
A small portion helps provide life coverage while the rest earn steady returns over time. As the policyholder continues to pay premiums, the plan accumulates benefits. The accumulated amount includes the guaranteed returns and any additional bonuses or additions that the policy may offer.
If the policyholder passes away during the policy term, the nominee receives the death benefit. This benefit typically includes the sum assured, guaranteed returns, and any accrued bonuses. It provides financial protection to the family in the event of the policyholder's demise. If the policyholder survives the entire policy term, they receive the maturity benefit. This includes the guaranteed returns and any bonuses or additions that have accumulated over the years.
Benefits of Investing in Guaranteed Return Investments
Investing in Guaranteed Return Plans can offer several benefits such as: -
- Guaranteed Returns: As the name suggests, guaranteed return investment plans offer fixed and guaranteed returns. This provides a sense of security, especially for risk-averse investors who prefer a stable income stream.
- Risk Mitigation: Guaranteed Return Plans are low risk investment plans compared to market-linked investment options. Since the returns are predetermined, investors are shielded from the volatility of the financial markets, making these plans an attractive option for those who want to avoid market uncertainties.
- Insurance Coverage: In addition to the investment component, Guaranteed Return Plans offer life insurance coverage. This ensures that in the event of the policyholder's death during the policy term, the family receives a death benefit, providing financial protection to the dependents.
- Financial Planning: These plans are designed to help individuals systematically save for future financial goals, such as education, marriage, or retirement. The guaranteed returns provide a foundation for disciplined savings and long-term financial planning.
- Flexibility: Policyholders can choose their premium payment frequency and enhance their plan’s coverage with riders. Guaranteed return investment plans allow investors to make financial decisions based on what works best for them.
- Tax Benefits: Policyholders may be eligible for tax benefits under section 80C of the Income Tax Act for the premiums paid and the benefits received, providing an additional incentive for investment.
- Fixed Premiums: Premiums in these plans are fixed and do not change over the policy term. This fixed nature of premiums helps individuals' budget effectively and plan their finances with certainty.
Top 10 Best Investment Plans with Guaranteed Returns in India
| Plan Name |
Entry Age |
Maturity Age |
Policy Term |
|
| TATA AIA Life Guaranteed Return Insurance Plan |
18 years to 65 years |
18 years to 85 years |
5 years to 40 years |
Invest Now |
| HDFC Sanchay Plus |
30 days to 65 years |
18 years to 85 years |
5 Years to 20 Years |
Invest Now |
| Bajaj Guaranteed Income Goal |
6 years to 60 years |
18 years to 72 years |
5 years to 20 years |
Invest Now |
| ICICI Prudential Guaranteed Income For Tomorrow |
18-policy term to 60 years |
18 to 85 years |
5 years to 20 years |
Invest Now |
| AEGON i-Guarantee Max Savings Plan |
3 Months to 50 years |
18 to 70 years |
7 years to 20 years |
Invest Now |
| Max Smart Wealth Plan |
91 days (about 3 months) to 65 years |
18 to 85 years |
6 years to 20 years |
Invest Now |
| Kotak Guaranteed Savings Plan |
3 years to 60 years |
18 years to 75 years |
10 years to 20 years |
Invest Now |
| Edelweiss Tokio Income Builder Plan |
18 years to 55 years |
18 years to 67 years |
6 years to 12 years |
Invest Now |
| Canara HSBC OBC Guaranteed Savings Plan |
0 years to 60 years |
18 years to 75 years |
10 years to 20 years |
Invest Now |
| TATA AIA Fortune Guarantee Plus Plan |
1 year to 60 years |
18 years to 77 years |
6 years to |
Invest Now |
How to Buy the Best Investment Plan with Guaranteed Returns Online?
The most effective way to buy the best investment plan with guaranteed returns in India online is through PolicyBachat because it offers several advantages making it a convenient and efficient choice for many individuals. At PolicyBachat, you can compare multiple investment plans from various insurers in one place. This simplifies the process of finding the plan that best suits your needs. Below are the steps to compare and purchase the best investment plan with guaranteed return online:
Here’s a step-by-step guide on how to buy a guaranteed return investment plan online:
- Visit the official website of the PolicyBachat.
- Click on the Investment Plan tab.
- Fill in the requested details such as name, mobile number, and email address.
- Enter your age and city.
- Select the plan which you want to buy. Click on the Proceed button.
- Use the online premium calculator to compare the premium amounts.
- Compare benefits, features, returns, and additional riders or bonuses.
- After comparing the products, select a plan which suits your requirements.
- Then pay for your policy by using an online payment method.
Factors to Consider While Buying a Guaranteed Return Investment Plan in India
Buying a Guaranteed Return Investment Plan is a significant financial decision that requires careful consideration. Here are key factors to keep in mind while purchasing an investment plan with guaranteed returns:
- Guaranteed Returns: Understand the guaranteed returns offered by the plan. Compare the rates across different insurance providers to ensure that the plan meets your financial goals.
- Policy Term: Evaluate the policy term offered by the plan. Choose a term that aligns with your financial objectives and the time horizon for your goals.
- Premium Amount: Ensure that the premium amount is affordable and fits into your budget without causing financial strain.
- Maturity Benefit: Examine the maturity benefit provided by the plan. Understand the total amount you will receive at the end of the policy term, including guaranteed returns and any additional bonuses.
- Death Benefit: Consider the death benefit payable to your nominee in case of your demise during the policy term. Ensure that the coverage amount is sufficient to meet your family’s financial needs.
- Riders or Add-ons: Check if the plan offers riders or add-ons, such as critical illness rider or accidental death rider. These additional features can enhance the coverage and provide more comprehensive protection.
- Liquidity Options: Review the plan’s liquidity features, including whether partial withdrawals or loans are allowed during the policy term. Understand any penalties or restrictions associated with early withdrawals.
- Tax Implications: Assess the tax benefits associated with the plan. Understand the tax implications of the plan both during the accumulation phase and at maturity.
- Credibility of the Insurance Provider: Look for insurers with high claim settlement ratios and a good reputation for customer service.
- Policy Exclusions: Understand the exclusions and limitations of the plan. Be aware of situations or events that may not be covered by the policy to avoid any surprises in the future.
- Flexibility: Check if the plan offers flexibility in terms of premium payment frequency, the ability to increase or decrease coverage, and options for modifying the policy to better suit your changing financial needs.
Tax Benefits under Guaranteed Return Investment Plans
Tax benefits under Guaranteed Return Investment Plans depend on the specific features of the plan and the prevailing tax laws. Here are some common aspects related to tax benefits:
- Tax Deductions on Premiums: Premiums paid towards Guaranteed Return Investment Plans may be eligible for tax deductions under Section 80C of the Income Tax Act, up to a specified limit.
- Maturity Benefits: The maturity amount received at the end of the policy term, including guaranteed returns and bonuses, is generally tax-free under Section 10(10D) of the Income Tax Act. This tax exemption applies as long as the premium paid does not exceed a certain percentage of the sum assured during the policy term.
- Death Benefit: In the unfortunate event of the policyholder’s demise during the policy term, the death benefit paid to the nominee is tax-free under Section 10(10D). This ensures that the financial support provided to the family remains tax-exempt.
Comparison between Different Types of Guaranteed Returns Plans
There are many types of guaranteed return plans such as fixed deposits (FD), public provident funds (PPF), debt mutual funds, National pension system (NPS), and more. Here’s a comparison table between Guaranteed Return Plans, Fixed Deposits (FDs), and Debt Mutual Funds:
| Factor |
Guaranteed Return Plans |
Fixed Deposits |
Debt Mutual Funds |
| Returns |
Fixed Guaranteed Returns |
Fixed interest rates are declared upfront |
Returns linked to interest rates and market conditions |
| Risk |
Low risk due to guaranteed returns |
Low to moderate risk, depending on the issuer’s credit rating |
Moderate risk due to market fluctuations |
| Life Coverage |
It provides a life insurance component |
No insurance component |
No insurance component |
| Tax Benefits |
Tax benefits under Section 80C for premiums paid and Section 10(10D) for maturity proceeds. |
Interest income is taxable, Tax benefits under Section 80C are not applicable. |
Taxation depends on the holding period. |
| Market Dependency |
Returns are not linked to market conditions. |
Returns are not linked to market conditions. |
Returns can be influenced by interest rates and market conditions. |
| Suitability |
Suitable for risk-averse investors seeking stable returns with insurance coverage. |
Suitable for conservative investors looking for fixed returns. |
Suitable for investors comfortable with market-related risks, seeking potential higher returns. |
Conclusion
A Guaranteed Return Investment Plan acts as a valuable financial tool, offering a combination of stability, financial protection, and assured returns. This investment plan is well-suited for individuals who prioritize certainty and security in their financial portfolios. By providing guaranteed returns, a clear policy term, and life insurance coverage, these plans cater to the needs of the risk-opposed investors while helping them achieve long-term financial goals.
A guaranteed return plan is a great way to maximize your returns from investments. It helps you get the most out of your money by providing a safe and secure investment option with fixed returns. By investing in a guaranteed return plan, you can rest assured that your money will grow steadily over time. So, compare investment plans online at PolicyBachat now to get the best guaranteed return investment plan based on your financial needs.