Reliance launched new fund offer Reliance Retirement Fund-2015, an open ended notified tax savings Plus pension scheme with no assured returns. The NFO Opens for subscription on 22th January 2015 & closes on 5th February 2015. No entry load will be applicable for the scheme.
Key Scheme Feature
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Cheque Details : “Reliance Retirement Fund- 2015.”
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Who can Invest
This product is suitable for investors:
- Adult Resident Indian Individuals, either single or jointly(not exceeding three).
- Non-resident Indians and persons of Indian origin residing abroad on a full repatriation basis.
- Parents/Lawful guardians on behalf of Minors.
- The fund reserves the right to include/exclude new/existing categories of investors to invest in the schemes subject to SEBI regulations and other prevailing statutory regulations if any. Currently individuals qualify for tax benefits U/S 80C of Income Tax Act,1961.
Investment Objective::
- To provide capital appreciation and consistent income to the investors which will be in line with their retirement goals by investing in a mix of securities comprising of equity, equity related instruments and fixed income securities. However there can be no assurance or guarantee that the investment objective of the scheme will be achieved.
Solutions
Fund Provides one Stop Retirement Solutions :
- Take advantage of Equity Oriented Scheme with an aim create long term wealth for post retirement.
- Liquidity & Flexibility: Withdrawal option after 5-year lock-in.
- Option to construct investment allocation between Equity/Debt, as per risk/return profile.
- Offering tax deductions for investments up to Rs.1.5 Lakhs u/s clause(xiv) of sub-section(2)of section 80C of Income Tax act.1961.
- Auto withdrawal through auto-SWP facility-Regular pension through automatic redemption of units, on or after 60 years of age.
- Step up facility -Option to increase investments systematically across life-cycle.
Why Retirement Planning Is Pertinent :
A 30-30 rule of thumb says an individual earns for 30 years, to provide for 30 years of post-retirement life where the individuals income would have stopped, Yet the need to maintain similar life style exists:
- An expense of Rs.1 lakh would be nearly 7 times more in 30 years due to inflation, assuming inflation rate of 7%.
- Indian demographics depicts trends of_1)Higher life expectancy.2)Increasing trend of nuclear family.3)Absence of comprehensive social security system.
- Retirement funds account for only 12% of one’s total savings.
- Also 78% of Indians don’t save enough for a comfortable retirement.
- Need for retirement Planning:1)Pay Cheques stop coming. 2)Break up of joint family system. 3)Absence of universal social security system. 4)Inflation-the silent devil. 5)60 is not old anymore.
Hence it is important to save and accumulate prudently for Enjoying your post retirement life.
Why important to save :
- Perils of Inflation-The Silent Devil-Inflation not only reduces the current purchasing power but also increases the savings requirement for future.
- Value of Rs.1 Lakh over a period of time due to inflation.
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Bottom line: The current expense will go up by approximately 7 times over next 30 years.
- It is not only important to Save but Invest.
- Different investment options give different rate of returns depending upon the risk return characteristics.Thus,small difference in rate of return results in a huge difference in the resultant earnings.
- Retirement corpus with a Monthly SIP of Rs.5000. [ws_table id=”641″]
Steps
- To save prudently, Reliance Retirement Fund offers to flexibility to choose asset class, depending on the actual requirement.
- To accumulate a healthy retirement corpus, Reliance Retirement Fund offers an option to increase SIP through STEP UP facility in the underlying schemes.(Wealth Creation and Income Generation Scheme)
- A STEP UP facility where in an investor who has enrolled for SIP, has an option to increase the amount of SIP installment by fixed amount at pre-defined intervals. This will enhance the flexibility of the investor to invest higher amounts to tenure of the SIP, thus aligning an increase in investor’s earnings with the SIP installment over the tenure of SIP.
- Auto transfer facility from Wealth Creation Plan to Income Generation Plan.
- To enjoy post retirement life Reliance Retirement Fund offers Auto SWP facility and other Liquidity Benefits.