Written by
:Reviewed by
NRI Investment Plans in India
The government of India has been making an effort to make the country more and more conducive to business. Today, with several investment plans for NRI at hand, NRIs worldwide often get confused about their options.
We, at Max Life Insurance, have tried to sort NRI investment options in India to help them maximise their returns in 2023.
1. Life Insurance
NRIs can purchase life insurance in India, although they are residing temporarily in a foreign country. However, such purchases and disbursals related to life insurance are subject to the guidelines of the Foreign Exchange Management Act while also following other applicable IRDAI regulations.
- Term plans for NRIs
- Child Plans for NRI
A pure protection plan for NRIs, term insurance is the best form of life insurance, which requires them to pay premiums for a fixed policy term and avail life coverage for a specific duration. Such plans offer the death benefit to the nominee if the insured does not survive the policy term. NRI term plans typically provide add-ons such as critical illness cover and accidental death and disability cover for enhanced life coverages.
- ULIPs for NRIs
- Retirement Plans for NRIs
Through child plans, NRIs can secure the future of their children even after their demise. These life insurance plans are designed for parents to help meet the key life goals of their children such as higher studies while also offering add-ons like waiver of premiums to ensure that children do not have to pay future premiums.
Unit Linked Insurance Plans (ULIPs) combine the benefits of life insurance and investment in a single policy. ULIPs for NRIs work exactly the way they work for Indian residents. Therefore, the policyholder’s dependents are entitled to the death benefit in case the policyholder dies during the policy term. In contrast, if the policyholder survives the policy term, they receive returns based on the ULIP’s performance.
Insurance companies in India offer retirement plans for NRIs that provide them with a monthly income after retirement through purchase of annuities. These NRI plans are aimed at helping them plan their life post retirement, thus securing their future financially.
2. Fixed Deposit (FD)
- Fixed deposit via NRO account
- Fixed deposit via NRE account
- Fixed deposit via FCNR account
NRO accounts allow NRIs to control their income in India, such as rental income or dividends from shares and mutual funds (if any) paid into their NRO account. If they can produce supporting documents, NRIs are allowed to remit up to $1 million from the NRO account.
NRIs can open an NRE account in Indian currency, with an interest rate of 5% to 7% subject to the duration of the tenure. The interest earned on such an account is tax-free in India but may not be in your residing country.
Another option is opening an FCNR (or Foreign currency non-resident) account, with a tenure of up to 5 years, where the interest earned is tax-free. The best thing about this account is there is no impact on forex fluctuations on deposits.
3. National Pension System (NPS)
With this account, NRI investment in India can be a maximum of 75% in equities, irrespective of the options such as Equity, Corporate bonds, and Government securities. In such a case, it is best to opt for auto choice to allow asset allocation based on life stage(s).
NPS account allows withdrawals of up to 20% of the total corpus before the age of 60 years while the rest 80% gets annuitised. However, up to 40% of the total corpus can be withdrawn on reaching or after 60 years of age, while the rest 60% must be annuitised.
Note: The pension payable from the NPS account is in Indian Rupees only.
4. Real Estate
In India, real-estate investments are a great option, as the country is highly expected to see massive development in the coming decade or so, which can be risky too. However, they are not allowed to purchase agricultural land in India. Therefore, do consider all the option and analyse the associated risk beforehand.
5. Direct Equity
6. Public Provident Fund (PPF)
7. Mutual Funds (MFs)
NRIs are allowed to invest in MFs only through their NRO or NRE accounts in India. Moreover, the rate of returns earned from mutual funds is subject to the fund type (i.e. debt, equity, or hybrid) and investment horizon.
Why should NRIs Invest in India?
Any India-born person who legally owns an Indian Passport, lives no more than 182 days in a financial year in the country, and currently lives abroad is an NRI or non-resident Indian. Given the rapid growth in FDI in India in the past decade, NRIs are inclined towards investing in their home country for the following reasons:
- To plan their retirement
- To earn good returns on investment
- To create financial assets
Indian financial markets offer several investment options for NRI, thus allowing them to secure their future. Long-term investments allow them to stay protected and enjoy a peaceful life with their family after retirement.
Investments in India are a great way to build a secure future for NRIs, provided they invest their money in the right instrument. Irrespective of the volume of money they invest, investors are getting good returns on their investments, considering the FDI growth in India.
Buying a property (either residential or commercial) in India is a great option for NRIs to build financial assets. Given the rapid development in Indian real estate markets, such investments can earn then good returns over time.
NRI Investment Plans in India by Max Life Insurance
Max Life offers multiple investment plans for NRIs to invest in India and earn good returns over time. This helps them expand their investment portfolio and financially help their loved ones residing in India.
- Smart Fixed-return Digital Plan
- ◦ Sum assured on maturity
- ◦ Accrued guaranteed additions (only with Titanium variant)
- ◦ Additional maturity benefit (on paying higher premiums)
- ◦ Additional maturity benefit (for female customers)
- Max Life Smart Wealth Plan
- Max Life Online Savings Plan
Max Life Smart Fixed-return Digital (SFRD) plan is a life savings plan that addresses the investment needs of an individual. SFRD is aimed at making your life investments easy by preparing investors for their financial goals. It offers the dual benefit of guaranteed*# tax-free returns and life cover.
SFRD offers a guaranteed*# corpus at maturity in case the policyholder survives the policy term. The maturity benefit offered is the sum of the following:
Max Life Smart Wealth Plan (SWP) is a life insurance savings plan that offers guaranteed*# returns to secures your future financially, thus allowing you to accomplish your life goals and fulfil your dreams.
NRIs can invest in Max Life SWP to build a corpus for their retirement and even to secure financial freedom of their loved ones residing in India, in their absence. This investment is a suitable option for those who seek to invest in a financial instrument that offers long-term capital appreciation with considerably low risk.
Max Life Online Savings Plan (OSP) is an online-only Non-participating, ULIP that offers a perfect combination of life insurance and investment for a secure future.
Max Life OSP provides a lump sum payout immediately on the death of the life insured, followed by regular payouts in the form of family income benefit as well as the total fund value at the end of the Policy Term.
Additionally, the company shall pay all future outstanding premiums after the date of death of the life insured.
NRI Investment Plans in India – FAQs
dpiit.gov.in/publications/fdi-statistics
sbnri.com/blog/nri-mutual-fund/mutual-funds-for-nris-from-usa-and-canada
cleartax.in/s/best-investment-options-for-nris
vakilsearch.com/blog/complete-guide-to-nri-investment-in-india/
Customer Reviews
Max Life Term Plan
“Max Life has helped me to identify the best term plan with adequate Life Cover for protecting my family’s future financial and giving me the peace to enjoy my present existence in this earth. Max Life has helped me to save through Endowment plans, thereby giving me a Guaranteed money at different stages of my life”
P. Kesavan
Max Life Term Plan
“Over all online policy purchase process was easy and purpose form filling process was easy and online premium payment process was easy”
Zaid Anwar
Max Life Term Plan
“Max Life Term Plan is first proper Term Plan to take care of me and my Family. With Max, I am at Peace of Mind with Max Life. I trust you and your Processes. I am Happy to have this Relationship. Manoj”
Manoj Chandwani
Max Life Term Plan
“Life Insurance Products provide arrangements for future events and there are various requirements at different life stages. For events that are to occur beyond 10 yrs, Life Insurance products are the only option. Keeping above in mind, I have Term Insurance, Endowment products taken almost 19 yrs ago and they will give Tax Free Lump sum amounts; I have Guaranteed Income Products and also Annuity Plan. For little better return on my investment I have ULIP plans. I have products, that will provide 25 - 50 thousand every year on my Grand Children’s birthdate - Annual Gift from grandparents when we will not be around”
Ashok Shah
Max Life Term Plan
“I had one endowment plan and one term plan with maxlife and I believe in making the difference with the help of MAXLIFE”
Satish Kumar
Max Life Term Plan
“Thanks for the opportunity to secure life with Max Life, the best term plan comparatively in the market which i opted today and seen that, this plan assisting many with the good claim settlement ratio by Max Life a trusted term insurance company.”
Naresh Vattela
Max Life Term Plan
“My experience has been great with Max Life Term Plan. I truly believe that it is the best term insurance that I have chosen for financial security.”
Roshni Mudliyar
Max Life Term Plan
“I bought the best Max Life Smart Secure Term Plan! from your team. Thanks for the assistance. ”
Kiran K
We would like to hear from you
Let us know about your experience or any feedback that might help us serve you better in future.
Do you have any thoughts you’d like to share?