Women are responsible for a lot in the household, and the budget is one of the most crucial duties. A woman, whether she is married or single with dependents, has a ton of responsibilities, and financial responsibilities are no exception.
Fortunately, in today’s day and age, various earnings and savings plans support a woman’s budgeting capabilities. The insurance sector also introduced several new policies to benefit women and low-income families, such as the 25k salary term insurance plan. Savings plans, in particular, have become quite popular in this era.
What are savings plans, and how do they work?
Savings plans are essentially any financial instrument that allows you to build a corpus steadily to serve various life purposes. Insurance savings plans are even better options as they not only help build a corpus but also secure your family with a financial backup plan in the form of a death benefit.
Savings plans are available for various tenures for different amounts of sum assured. You can choose the type of savings plans that best align with your household needs. Here are the types of savings plans available these days:
- Endowment plans – These are a type of insurance policies that offer bonus earnings with your life insurance plans.
- Money-back plans – These are another form of life insurance that allows you to withdraw a specified sum of money at regular intervals to support your sudden financial needs.
- Provident Funds – These are funds that help you build a corpus over time and are offered to employees in both the private and public sectors.
- Fixed Deposits – These are savings plans that guarantee you a predefined rate of return for investing your money in FDs for a specified period of time.
- National Pension Schemes – These are government schemes that you can invest in during your lifetime by choosing a specified return and duration. After retirement, the NPS pays you a monthly or annual income as per your selection and investment.
These plans are designed to help you build the corpus you need to meet life’s challenges at every life stage. You can choose the ideal savings plan schemes from insurers or government funds based on your needs.
How savings plans help women manage variable household budgets?
Investing in savings plans plays a vital role in planning your household finances. Savings plans are a corpus built for emergencies. These emergencies can arise at any time due to economic crunches, surprise expenditures, medical emergencies, dependents’ needs, etc. Thus, it is important to stay prepared.
Different types of savings plans serve different purposes. While insurance policies such as endowment plans and moneyback plans allow you to withdraw your money at regular intervals, they also secure the future financial needs of your loved ones. Various other forms of life insurance can also serve as excellent savings plans.
Life insurance policies such as ULIPs allow you to invest your money in the current market to earn profits. Term plans, on the other hand, are very affordable and flexible policies that you can purchase without financial strain.
The 25k salary term insurance plan was also introduced to facilitate the coverage of life insurance for low-income households. The benefits of these plans help you plan the household budget in the event of the death of the primary wage-earner. The coverage of such plans depends on your annual household income.
Other forms of savings plans available in the market serve to grow your funds steadily, but at lower rates of return. Provident funds are available to both the public and private sectors. You can also use the Fixed deposit funds to double down on your savings plans.
The National Pension Scheme, or NPS, is a very useful financial corpus. It ensures that you have a sufficient corpus for your golden years that you can use after retirement or, in the event of your death, your spouse can use to pay major expenses.
The NPS is easily replaceable with retirement plans from insurance providers. There, too, you can select the amount of money you want to be paid monthly or annually after retirement. It adds a steady source of income for the household. This is particularly helpful for women planning household expenses on a fixed budget.
Conclusion
Budgeting is very important in the household. For varying household budgets, it is important to find a solution that is affordable and builds a corpus for later. Women need to account for all the family expenses, emergency funds, liabilities, educational needs, etc., when planning the budget.
Savings plans contribute a specified sum of money to the household budget and can pull you out of dire situations when the need arises. While policies like a 25k salary term insurance plan help acquire a life insurance plan for low-income households, savings plans help you build a corpus for you and your beneficiaries.
