SBI Life Annuity Calculator: What will be investment amounts to get Rs 10,000 and Rs 15,000 monthly payouts in life annuity scheme? See calculations
SBI Life Annuity Calculator: An annuity is a contract between an insurer and the policy holder where they pay premiums, and the insurance company makes payments to the person immediately or in the future.
SBI Life Annuity Calculator: Annuity plans are for persons seeking income from the insurance company after making a one-time payment or in instalments. The payouts can be started immediately or after a deferred period. Annuity plans can be non-market-linked, where the person buying a plan knows the fixed amount they will get during the whole tenure. Such plans can also be market-linked, where payouts depend on the performance of the fund the insurance company has invested the policy's money in. While annuity plans can provide security to the policyholder, providing payouts monthly, quarterly, half-yearly, or yearly, the policyholder can also pay their premiums monthly, half-yearly, or yearly. Know the types of annuity plans and the amount one needs to invest in SBI Life annuity plan to get Rs 10,000 and Rs 15,000 monthly payouts under the life annuity category.
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(Disclaimer: These are projections. Actual calculations may vary. This is not investment advice. Do your own due diligence or consult an expert for financial planning.)
Annuity plans can be immediate or deferred annuity plan
The plan starts working from the time one invests in it. After making a lump sum amount, the payouts are either for a limited tenure or a lifetime.
Deferred annuity
In such kinds of annuity plans, the annuity payout starts after a certain date. The deferred annuity plans can be of 2 types.
Fixed annuity plans
It gives a guaranteed amount throughout the tenure. The payout is decided at the time of purchasing the plan. The payout doesn't get affected by market fluctuations.
Variable annuity plan
In this type of plan, the insurance company invests the premiums paid in mutual funds or equity, and the payouts depend on the return from these instruments.
Tax benefits
Immediate annuity plans offer tax benefits to old tax regime taxpayers on premiums paid up to Rs 1.50 lakh in a financial year under Section 80C of the Income Tax Act, 1961.
What are different types of annuities?
Here, the policyholder gets regular (monthly/quarterly/yearly) annuity payouts from the insurer till they are alive. The annuity stops after the policyholder's death.
Life annuity with return of purchase price
The policyholder continues to receive annuity payments until their death. After that, the insurance company returns the invested amount to the nominee.
Annuity payable for a guaranteed period
Here, the annuity is paid for a guaranteed period that can be 5, 10, or 15 years, even if the policyholder dies. The annuity payout stops either on the death of the annuitant or the completion of the guaranteed period, whichever is later.
Inflation-indexed annuity
In this type of an annuity plan, every year, there will be a rise in the annuity payable at a certain rate, say 2 per cent or 5 pr cent. Such a plan is aimed at taking care of the increase in the expenses of an individual.
Joint life survivor annuity
The plan keeps paying to the policyholder till either they or their spouse is alive.
Joint life annuity with return of purchase price
It keeps paying till the policyholder or their spouse is alive. After their deaths, the nominee gets the initial invested amount.
Calculations
We will calculate the total investment to get monthly payouts of Rs 10,000 and Rs 15,000 in SBI Life annuity plan under the life annuity category.
Annuity investment to get Rs 10,000 monthly payout
As per estimates, the purchase price to get Rs 10,000 monthly payout will be Rs 19,06,306; tax applicable will be Rs 34,314, and the total premium with taxes will be Rs 19,40,620.
Annuity investment to get Rs 10,000 monthly payout
To get Rs 15,000 monthly payout, the estimated purchase price will be Rs 28,36,469, the estimated taxes will be Rs 51,058, and the estimated premium will be Rs 28,87,527.