When we talk about retirement planning, the pension funds offered by mutual fund houses rarely get a mention as can be seen from the low corpus that these funds have garnered in a span of more than 15 years. However, if you want to consider investing in pension products offered by mutual funds, they do offer dual benefit of tax deduction (up to R1 lakh under Section 80C) as well as disciplined saving for your retirement years. Though, currently there are not many offerings available, you must look at factors like the investment strategies (equity-debt mix) that they follow and their performance track record till date. Since these are pension plans, any withdrawal from them comes at a cost. Finally if you opt for the tax deduction, you will have to abide by a 3-year lock-in period. As these are not pension schemes in the real sense, there is no compulsory annuity scheme to be purchased on retirement.
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