Whether it’s buying a home, sending your child abroad for education, or enjoying financial freedom post-retirement, your aspirations deserve more than just wishful thinking—they need planning. And not just any plan, but one that combines discipline, growth, and protection.
That’s where a savings plan steps in.
It’s not about stashing away money—it’s about building wealth, enjoying financial security, and preparing for life’s surprises and celebrations. But which plan is right for you? Let’s decode the types of savings plans in India and the benefits they bring to your financial journey.
1. Endowment Plans
Endowment policies combine insurance and savings. You get life cover along with a lump sum on policy maturity, provided all premiums are paid. If something unfortunate happens, your family still receives the sum assured.
Benefits:
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Guaranteed payout either as maturity or death benefit
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Helps in disciplined savings
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Suitable for people with low-risk appetite
2. Unit Linked Insurance Plans (ULIP’s)
ULIPs are a mix of investment and insurance. A portion of your premium goes towards life cover, while the rest is invested in equity, debt, or balanced funds based on your risk appetite.
Benefits:
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Market-linked returns
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Flexibility to switch between funds
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Ideal for long-term goals like child’s education or wealth creation
Consider this: The Aviva Signature Investment Plan – Platinum is a ULIP that helps you grow wealth while securing your loved ones. It offers fund-switching flexibility, multiple investment options, systematic withdrawals, and a RetireSafe feature to reduce risk closer to maturity. Plus, it comes with life cover and tax benefits—giving you both growth and protection in one plan.
Invest up to ₹2.5 Lakh annually in ULIPs to optimise tax efficiency. Over time, tax-free returns on maturity enhance financial efficiency while ensuring long-term protection for your family.
3. Child Savings Plans
Every parent dreams of giving their child the best opportunities in life. Child savings plans are designed to financially secure important milestones in a child’s life—schooling, higher education, and even marriage.
Benefits:
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Lump sum at key stages of a child’s life
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Waiver of premium in case of the parent’s demise
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Ensures continuity of benefits, no matter what happens
4. Pension Plans
A pension plan ensures your post-retirement years are spent with peace, not financial anxiety. These plans help accumulate a corpus during your working years, which later gives you a regular income.
Benefits:
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Retirement income through annuity payouts
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Option to choose immediate or deferred annuity
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Ideal for securing life after 60
Consider this: The Aviva Signature Increasing Income Plan is designed for lifelong financial comfort. It provides a guaranteed monthly income that increases by 15% every 3 years to combat inflation. In case of an untimely demise, Aviva continues to fund future premiums while your family keeps receiving income benefits—ensuring uninterrupted financial support.
5. Guaranteed Savings Plans
These are non-linked, non-participating life insurance policies that offer guaranteed returns along with life cover. You receive assured benefits either at regular intervals or at the end of the policy term.
Benefits:
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Guaranteed returns with no market risk
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Life cover included
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Flexible premium payment and payout options
Consider this: The Aviva Signature 3D Term Plan – Platinum goes a step further than traditional term insurance. It provides comprehensive protection against death, disease, and disability, and includes a Preventive Wellness Package. With special premium rates for women and non-tobacco users, it’s ideal for those seeking financial security along with health-conscious features.
6. Public Provident Fund (PPF)
A government-backed long-term savings option, PPF is ideal for conservative investors. It comes with a 15-year lock-in but offers attractive tax-free returns.
Benefits:
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Tax-free interest
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Safe and stable returns
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Suitable for long-term goals like retirement or education
7. Sukanya Samriddhi Yojana (SSY)
Aimed at the girl child, this government scheme offers high interest and tax benefits to encourage early savings for a daughter’s future.
Benefits:
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Attractive interest rate
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Tax benefits under Section 80C
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Withdrawal allowed for education or marriage after the child turns 18
8. Senior Citizens Savings Scheme (SCSS)
Exclusively for individuals above 60, SCSS is a safe investment option with quarterly interest payouts and tax benefits.
Benefits:
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Regular income after retirement
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Government-backed security
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Tax deduction under Section 80C
How Tax Benefits Make a Difference?
Savings plans can significantly reduce your tax burden while helping you build wealth. Most life insurance-based plans offer deductions under Section 80C, and the maturity proceeds are tax-free under Section 10(10D). Add-on riders like critical illness also qualify for deductions under Section 80D.
For instance, Nitin, a 40-year-old IT professional earning ₹30 lakh annually. He invested ₹1.5 Lakh in the Aviva Signature Investment Plan – Platinum (a ULIP), reducing his taxable income and saving ₹45,000 in taxes under Section 80C. By adding a critical illness rider to his Aviva Signature 3D Term Plan – Platinum, he claimed an extra ₹25,000 deduction under Section 80D.
Later, he used tax-free partial withdrawals to support his children’s education, and his retirement payout remained exempt under Section 10(10D)—proving that smart planning offers both protection and tax savings.
*As per Section 10(10D), maturity and death benefits from ULIPs remain tax-free only if the total annual premium does not exceed ₹2.5 Lakh, as per the Finance Act 2023 amendments.
Why Should You Invest in a Savings Plan?
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Dual benefits of life cover and financial growth
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Regular income or lump sum returns to meet goals
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Low risk options available for conservative investors
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Customisable features like premium term, payout options, and riders
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Peace of mind knowing your family is financially protected
Tips to Choose the Right Plan for You
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Define your life goals – education, home, retirement, legacy
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Consider your risk appetite – go for ULIPs or mutual funds for higher returns, or endowment and guaranteed plans for stability
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Choose a tenure that matches your goal timelines
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Evaluate if you need liquidity or flexibility
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Don’t forget to check riders for added protection