- GO for a pure pension policy. Avoid policies that have a mandatory life cover.
- ASK your agent for a benefit illustration and look at the effective yield. Pension policies, typically, have low distribution cost and zero mortality charges. So, the post-cost returns of good pension plans are very close to the assumed rate of return.
- CHOOSE funds whose returns over the years are close to the benchmark returns, if not higher
- DO NOT buy a policy that has capital guarantee; it comes at a cost
- START with a well-diversified equity portfolio, since you are planning for retirement. Check if your policy has an equity option
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