Pension plans also referred to as retirement plans. These are offered by insurance companies to help individuals build a retirement principal sum. On maturity this sum is used or invested for generating an interrupted and regular income source, which is referred to as pension or annuity. It is pension plans that provide individuals with a regular income in their older days. It will provide the financial security to pursue unfulfilled dreams.
There are four kind of pension/annuity plans from which a person can choose, which depends upon his personal requirement.
• Guaranteed period annuity
• Life annuity
• Deferred annuities
• Annuity certain
1. Employment-based pensions (retirement plans):
Consistent savings over a period of time, till people are in a job, help people for their retirement
2. Social and government sponsored pensions:
Governments of some countries provide money to people through pensions
3. Disability pensions:
People with special needs also get a certain amount of pension so that they can sustain themselves and their families
Benefits of Pension Plans
Pension Plans or Retirement Plans is considered to be the best, safest and surest way to live a life of a trouble-free retirement life. It provides money to retired old people to have a basic standard of living.