SBI Pension Plan Scheme – Annuity Plus
Annuity Plus from State Bank of India is a conventional non-participating pension plan that provides a considerable amount of flexibility features so far as annuity options are concerned. When an individual does not receive any income post retirement and medical expenses must still be incurred, this plan offers income that acts as some sort of security to the retired person so that it becomes easier to maintain standard of living.
Features of Annuity Plus
- Multiple annuity payout options to choose from.
- The minimum age for an individual to apply for this scheme is 40 years.
- Pension will be offered for the entire lifetime of the policyholder or his/her partner’s lifetime. Partner may be spouse, siblings, parents, children or in-laws.
- Annuity payouts are done on a yearly, half-yearly, quarterly and monthly basis.
- The minimum annuity payout is Rs.200 per month.
- Higher annuity rates can be availed by making higher premium payments.
- Payment of extra premiums will make riders available.
- Options for financial institutions and banks to make annuity payments to owners who have engaged in reverse mortgage with the bank / financial institution.
- The minimum sum assured is Rs.25,000 and the maximum is Rs.50,00,000.
Benefits of Annuity Plus
- Higher annuity rates can be availed if the premium payments are higher. These rates will offer between Rs.2.50 and Rs.4.25 for each additional premium of Rs.1000 paid in excess of Rs.1,50,000.
- Accidental benefits can be availed by making additional premium payments and the policyholder will receive the sum assured in such cases.
- All premium payments made towards this pension plan qualify for tax deduction under Section 80CCC of the Income Tax Act.
- The lump sum amount received by the policyholder after death is exempt from tax.
- Annuity payments will be taxes based on the income tax applicable to the policyholder.
Variants of Annuity Plus
- Single life policy: Annuitants are guaranteed payout throughout their life, and there is an option that allows the customer to choose the lifetime payout wither with or without the refund of premium paid.
- Two lives policy: Annuitants are guaranteed annuity payouts throughout their life. Since there are two annuitants, the survivor in case of a death can choose lifelong payout either with or without the refund of premiums paid.
- Increasing annual rate: A 3% to 5% increase in annual payouts occur in this variant and the annuitant will receive payouts throughout his/her life.
- Balance capital refund: Annuity payouts in this variant happen constantly throughout the lifetime of the annuitant. Upon the death of the annuitant, the balance will be paid to the partner. The balance premium that will be paid out includes the premium paid minus annuity paid.
- Minimum fixed period: The annuitant receives yearly payouts constantly for at least five years. The periods vary from five years to 20 years in multiples of five.
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