- Date : 12/08/2022
- Read: 3 mins
Escape stock market volatility with LIC Jeevan Labh and earn steady risk-free returns.
One can take various approaches to retirement planning. If you have an aggressive risk profile, you could invest mostly in equity mutual funds. If you have a moderate risk profile, you can invest in a mix of equity and debt products. If you have a conservative risk profile, consider debt products.
In this article, we will discuss one such debt product: LIC Jeevan Labh.
What is the LIC Jeevan Labh policy?
LIC Jeevan Labh is an endowment savings plan from the Life Insurance Corporation of India (LIC). The policy offers a combination of protection and savings. If the life insured dies anytime during the plan tenure, LIC will provide financial support to their family by paying the ‘sum assured on death’ and accrued bonuses. If the life insured survives the entire policy tenure, they will get the ‘sum assured on maturity’ and accrued bonuses.
Important features of LIC Jeevan Labh policy
Here are the main features of the policy:
Note: You can make the policy premium payment on a yearly, half-yearly, quarterly, or monthly basis.
Building a retirement fund with LIC Jeevan Labh policy
An investor can choose to build a retirement fund with the LIC Jeevan Labh policy. Depending on your age, you can choose a plan tenure of 16, 21, or 25 years. Accordingly, make premium payments for 10, 15, or 16 years. For ease of payment, select the monthly premium option and register for an auto-debit from your bank account.
Let us assume that you choose a 25-year plan tenure and contribute Rs 92,400 annually (Rs 253 per day) for wealth creation. For endowment policies, LIC usually invests most of the premium in risk-free assets such as government bonds. On maturity, you will get Rs 54.50 lakh.
On retirement, when your policy matures, you can take the sum assured as a lump sum payment or in instalments. The instalments can be taken for a period of 5, 10 or 15 years. The instalment frequency can be monthly, quarterly, half-yearly, or yearly.
LIC Jeevan Labh: A risk-free option to build a retirement fund
We saw how people with a conservative risk profile should invest in debt products. LIC policies are preferred by investors who wish to avoid stock market risk and volatility. LIC Jeevan Labh is one of the best investment products for retirement. It lets you build your retirement fund in a risk-free manner with total peace of mind.
Also Read: Five Retirement Planning Blunders To Avoid
The best part? Upon retirement, when your policy matures, instead of a lump sum amount, you can take monthly payments for up to 15 years.