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What is the 'Retired Life Income' option in Bajaj Allianz Long Life ULIP?

By Finserv MARKETS - Aug 28,2019
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ULIPs – Long Life Goal


There’s no disputing the fact that after hustling for decades at work, people like to retire in comfort, sans worries about paying the bills. To this effect, you might have already started planning and investing in order to build a corpus for retirement. We eagerly look forward to the leisurely golden years, but at the given rate of inflation, it might be difficult to live comfortably unless you plan prudently. According to an independent research conducted by Schroders in April 2018, people all over the world feel that they should be saving more of their income for retirement.

The message this sends us is clear: Investing can help bolster income to provide for the post-retirement life you deserve. Saving and investment can help add comfort in your life, whether you are decades away from it, or years into it.

One of the more effective financial instruments that can help you achieve this goal, along with providing an added layer of life insurance cover, is the Unit Linked Insurance Plan. It is a wonder product that combines the dual benefits of both insurance and investment.

A ULIP retirement plan like the Bajaj Allianz Life Long Life Goal is focused on helping you create a retirement corpus that is big enough to last you the rest of your life. It is a fair deal where you pay premiums for a limited time and get regular income during your retirement years. Yearly loyalty additions, coverage till the age of 100 and tax exemptions are other benefits that make this an attractive investment plan.

Pay-outs after retirement are becoming increasingly crucial for a couple of economic reasons, apart from the social and cultural changes in terms of increased life expectancy, medical inflation, and preference for a nuclear family. Data from World Economic Forum (WEF) shows that India has a huge retirement savings deficit, contributing to post-retirement financial inadequacy.

As a result, retired employees depend on their children in their old age. The old-age dependency ratio as per 2011 census data stood at 142, which meant one elderly person for 7 people of working age. Projections suggest that this old-age dependency ratio will rise to 192 by 2026.

What is the Retired Life Income (RLI) in a Bajaj Allianz Life Long Life Goal ULIP exactly?

The Bajaj Allianz Life Long Life Goal ULIP functions as a regular premium payment endowment plan.

You may decide to receive the RLI, which is akin to a regular income pay-out:

a) At any Policy Anniversary, or either on the year you turn 55, or once the policy has completed 10 years, whichever is later.

b) As a percentage of your Fund Value ranging from 0 to 12% per annum, as chosen by you, payable yearly, half-yearly, quarterly or monthly.

It is important to note that the RLI is paid out through Systematic Partial Withdrawal which simply means that you get to withdraw some amount of your own money from the Fund that would otherwise accumulate for the end of the policy tenure. Also, the RLI percentage can be changed anytime during the Policy Term, even after the start of Retired Life Income disbursal.

It is also imperative that the fund value after payment of the installment of Retired Life Income does not drop below 105% of total premiums paid till date, otherwise your ULIP returns gets impacted. In case the fund value drops below 105% of the total premiums paid till date, the RLI may not be sufficient to meet the percentage chosen by you, and a lower amount will thus, be paid out.

The flexibility is another selling point: you can choose to exit out of the ‘Retired Life Income’ option at any time, even if it is after the start of the RLI, and opt back in anytime, too. There’s also an option to withdraw the fund value completely as Surrender Benefit.

Therefore if you are planning for a peaceful retirement where you do not have to compromise on your life goals, you can choose to invest in Bajaj Allianz Life Long Life Goal available online on Finserv MARKETS. Avail ULIP tax benefits with exemptions on both returns and investments, plus you get to invest in market-linked funds while building a corpus for retirement and an insurance cover for life. This unit linked insurance plan really is the best of both worlds.

To know more on ULIP investments in depth, you can check out these blogs:

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