LIC Jeevan Shanti Plan is a pension plan that promises great returns for the investors. It is a single premium plan in which the policyholder has the option to choose between single life and joint life deferred annuity. Annuity rates are guaranteed at the inception of the policy and the annuities are payable throughout the life of the annuity for the post-deferment period. It is possible to get the desired pension per month under this policy because higher the investment amount, higher will be the pension amount.
An annuity is a regular payment amount such as a pension paid by insurance companies to policyholders. The minimum investment amount in the policy is Rs 1.5 lakh.
The minimum entry age for LIC Jeevan Shanti policy is 30 years while the maximum age is 79 years. LIC offers two options under the LIC Jeevan Shanti plan. One is the immediate annuity plan and the other is the deferred annuity option. While policyholders start receiving pension immediately upon investing in the Tatkal plan, they get pension after a few years when they invest in a deferred annuity. Deferred annuity plan is good for those who have not retired yet, whereas immediate annuity plan is good for retirees and senior citizens.
In deferred annuity option, investors get pension for their lifetime. The interest rates for the annuity are decided at the inception of the policy.
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Since it is a lump sum investment scheme, investors get multiple options as per their investment potential and pension depends on the investment amount.
Apart from the guaranteed lifetime pension, Jeevan Shanti has a unique benefit called Guaranteed Addition. Under the deferred pension option, a guaranteed additional amount will be credited to the policyholders’ accounts every month during the moratorium period.
In case of unfortunate death of the policyholder, before the commencement of pension, the purchase price and the guaranteed addition accumulated till the date of death, will be returned to the nominee and the compensation is subject to a minimum of 110 per cent. Investment.
For example, at the entry age of 50 years, where the moratorium period will be 10 years, the policyholder will get a lifetime monthly pension of Rs 8,742 from the beginning of the 11th policy year or 61 years of age. During the moratorium period, an amount of Rs 8584 will be added to the policy account every month as a guaranteed addition.
Now, suppose the policyholder dies at the end of 5 years 4 months or above the age of 55.4 years, then the total accumulation in his account will be Rs 5,49,376 (64 months x Rs 8584) and received by the nominee The total amount will be Rs 15,49,376.
Now suppose a policyholder invests Rs 50 lakh at the age of 50, he will get Rs 43,920 per month pension at the rate of 10.99 per cent per annum from the beginning of the age of 61 years.
If a policyholder invests Rs 1 crore at the age of 50, he will get a pension of Rs 87,923 per month after retirement at the rate of 11 per cent.
Suppose you invest Rs 25 lakh in LIC Jeevan Shanti plan at the age of 50, you will get a pension of Rs 21,929 per month after retirement at the rate of 10.98 per cent.
