Here’s How a Savings Plan Will Benefit a Non-Working Spouse!

Here’s How a Savings Plan Will Benefit a Non-Working Spouse!

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Homemakers play an essential role in each household and in society but it is a common practice to treat them as second-class citizens because there is no monetary value associated with their work. Even in the context of buying a life insurance policy, the non-working members of a family find themselves with fewer options in comparison with their earning counterparts. Therefore, it is necessary to have a savings plan for the non-working members of a household.

Who is a Non-working Spouse?

In insurance terms, a non-working spouse is a person who is not engaged in any work outside the home. In India, women primarily constitute this group as they choose to become homemakers, often quitting their successful careers, for the sake of family commitments. Insurance companies have fewer policies available for non-working spouses as apparently they lack a steady stream of income. However, there are some savings insurance schemes they can invest in and financially secure their future. Examples of such plans include money back insurance policies and mutual funds.

Benefits of a Savings Plan in India

A savings plan has significant benefits especially in the Indian context. Considering these benefits, it is important to contribute to such a plan for the non-working spouse to protect their interests.

  1. Financial security

A savings plan provides financial security to an individual, particularly a non-working spouse who does not have a regular stream of income of their own.

  1. Savings and investment habit

Investing in a savings plan develops the habit of saving and investing regularly. This disciplined approach allows the entire family to visualize their important goals and refrain from unnecessary expenditure.

  1. Assistance for professional or personal goals

By investing in a savings plan, a non-working spouse can accumulate funds to pursue their professional or personal goals such as starting a small business or joining an educational course.

Savings Plans Available for Non-working Spouses

The amount of savings a married couple needs to make depends on their financial goals and capabilities. It is important for a married couple to have a shared responsibility for the life goals in order to optimise their finances. In this context, non-working spouses can invest in the following guaranteed savings plans.

  1. Bank deposits: An investment in a bank deposit, namely, a fixed deposit (FD) or a recurring deposit (RD) is a safe and efficient savings plan for any individual, including non-working spouses. These instruments have a fixed rate of interest and carry no risk.
  2. Mutual funds: Non-working spouses can also invest in mutual funds and select a portfolio that matches with their risk appetites. A mutual fund investment can be started even with a small investment and encourages the habit of regular savings.
  3. Public Provident Fund: Investing in the Public Provident Fund (PPF) is a safe and reliable saving advantage plan. The scheme enables investors to invest as low as ₹500 per annum and earn a fixed rate of interest on their investments. However, PPFs have a lock-in period of 15 years, making them suitable options for a long-term investment.
  4. Money back insurance policy: A money back insurance policy is a product that has the features of insurance, investment, and regular income. By investing in a money back insurance policy, you can get a consistent stream of income at regular intervals after investing a fixed amount of money for a fixed amount of time. These plans are preferred by people looking to secure a regular income at the end of their working

There are several insurance companies that offer money back insurance policies and savings insurance plans. With the Tata AIA life insurance process, you can choose their money back savings plan which has both a regular income option and an income with critical illness benefit. The plan has flexible annual or monthly payouts to meet the requirements of a non-working spouse.

Conclusion

There are many benefits of investing in a savings plan, particularly for a non-working spouse. You should research such plans and invest in the one you find feasible.

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