VMPL
New Delhi [India], January 15: Savings plans used to be something people thought of only for retirement. But now, they are being used in various other ways. As life and financial goals change, these plans have become more flexible and beneficial. People are using them to save for important milestones, achieve their dreams and even handle unexpected expenses. It shows how financial planning is changing in India. These plans are no longer just about the distant future--they're about making life easier and more secure today too.
Uses of a savings plan
A savings plan is a smart way to set aside money for a specific period, ranging from a few years to even a couple of decades. You can choose this based on your goals. The best part is that these plans allow you to lock in your funds for a chosen duration while earning steady returns. Once the lock-in period ends, the accumulated amount can be used in multiple ways. Here are some practical ways people use their savings effectively.
- Emergency fund
A savings plan can act as a reliable safety net during tough times. Unexpected medical bills, home repairs or sudden job loss can strain your finances, but having a dedicated emergency fund ensures you're prepared for such situations. Since savings plans offer disciplined contributions over time, you can build a solid cushion without feeling overwhelmed, offering peace of mind when life throws a curveball.
- Save for major purchase
Dreaming of buying your first car, upgrading your home or getting the latest gadgets? Savings plans help you work toward big purchases by accumulating funds systematically. Instead of dipping into your regular income or taking a loan, you can save in advance. Plus, the returns earned during the lock-in period give your savings a much-needed boost.
- Child's education
Education costs are on the rise, making early financial planning essential for your child's future. Savings plans help you steadily build a fund over time to cover tuition fees, school expenses or overseas studies. By locking in funds for a specific duration, you can ensure that the money is available when you need it most, giving your child the best opportunities without financial worries.
-Wedding
Whether it's your own wedding or planning for your child's big day, savings plans are a great way to fund the celebration. They can cover significant expenses like venue bookings, catering, gifts and more. This way, you can prepare stress-free, knowing that your finances are well taken care of.
Who should opt for a savings plan?
Savings plans are designed to suit a variety of financial needs and lifestyles. They can help you save systematically and achieve your objectives. Here's a closer look at who can benefit from a savings plan:
1. Young professionals:
If you're just starting your career, a savings plan is a great way to get into the habit of saving. It helps you set aside part of your income regularly, making sure you stick to good money habits from the beginning. The earlier you start, the more time your savings have to grow. This means you'll be better prepared to fund your future goals or deal with unexpected costs.
2. Low-risk investors
If you prefer stable returns and want to avoid a high-risk investment plan, choose savings schemes. They help you keep your money safe and grow it steadily over time, with very little exposure to market changes. They offer security and make sure your money works without surprises. If you want to know exactly how your money will grow and prefer things to be predictable, savings plans are a good option for you.
3. Short-term financial goals
Savings plans are ideal if you have short-term goals, like buying a car, going on a vacation, or renovating your home. They help you save money in a structured way for a set time, so you'll have enough when you need it. This approach also stops you from spending too much, keeping you on track to reach your goal without stress.
4. Variable income earners
If you have a fluctuating income, such as in freelancing or commission-based jobs, a savings plan can provide financial stability. By setting aside a fixed amount regularly, you can keep saving even when your earnings are low. This gives you a financial cushion for the months when you don't make as much.
Conclusion
Savings plans can also help you save on taxes. Many of these plans let you lower your taxable income under sections like 80C of the Income Tax Act. In some cases, the money you make from the plan, like returns or the amount you get when the plan ends, might not be taxed at all. This means you're building up savings for your goals while also paying less in taxes, making savings plans both smart and practical.
(ADVERTORIAL DISCLAIMER: The above press release has been provided by VMPL. ANI will not be responsible in any way for the content of the same)
