Savings Plan: How to choose

Follow these steps to choose a savings plan with confidence.

1. Define the goal and date. Know the amount and year you need the money.
2. Compare effective returns. Ask for the IRR of the plan on guaranteed benefits and, separately, illustrated bonuses.
3. Check life cover. A higher cover multiple generally means better protection for the goal.
4. Compare with alternatives. Consider PPF, mutual funds and fixed deposits alongside, based on risk and tax.
5. Understand the charges. For ULIPs, review premium allocation, administration, mortality and fund management charges.
6. Plan to stay the course. Pick a premium you can sustain for the whole term.

Questions to ask before you buy

• What is excluded or limited, and for how long?
• What exactly is guaranteed and what is not?
• How are claims made, and how long do they usually take?
• What happens if I miss a payment?
• Can I cancel in the free-look period, and what is refunded?
• How will this plan change as my life changes?

Use our tools

Savings Goal Planner Child Education Planner SIP Growth Calculator Lump-sum Growth Calculator Policy comparison scorecard