Ask Value Research

Should I go for pension plans for my retirement?

It is better to opt for pure investment products for long term goals like retirement

I work with a private sector company. Please advise me on inflation-linked pension plans and their pros & cons.
-G.Anand Ramachandra Rao

If you are referring to pension-insurance plans, we do not recommend insurance products for investment purpose. We would advise you to keep insurance and investment needs separate. Products with insurance and investment elements in them mostly fail on both counts: they offer very little insurance cover and they are also not great investment products.

If you looking for an investment product to build a corpus for your retirement, then you can choose pure investment products like mutual funds. It is advisable to buy a term insurance plan to cover your life and invest in equity mutual fund schemes to meet their long-term financial goals like retirement. If you are planning to build a retirement corpus, you can consider investing the money in a staggered manner by investing via monthly SIP in one or two diversified equity schemes.

Here is a list of best diversified equity schemes.

This article was originally published on May 26, 2017.

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