Why single mother should invest in ULIP?
Single mothers have the onus of providing for their child’s small and big needs. They might save primarily for their child and also for a secured financial future for themselves. Unit Linked Insurance Plan can help them in both of these endeavours. Here’s how –
Child ULIPs for the child’s future
Child plans are available as ULIPs that can allow single mothers to enjoy inflation-adjusted returns on their premiums. Moreover, these plans often give the premium waiver benefit, either as an inbuilt rider or as an optional one1.
The premium waiver rider waives the premium if the mother passes away, suffers a critical illness or becomes disabled during the policy tenure1. The insurance company pays the premiums on the mother’s behalf, and the policy continues to be unaffected. On maturity, the child can enjoy the maturity benefit, which would give it financial assistance for higher education or any other needs.
Thus, if you ever wonder, “Can single mother buy ULIPs?” then you need to know that ULIPs secure the corpus for the child’s future whether the mother is around or not. This brings peace of mind to single mothers.
Whole Life ULIPs
Besides planning for the security of the child’s future, single mothers might want to plan for their retirement, too. In such cases, whole life ULIP plans can come in handy. The policy benefits/returns from these plans may help single mothers create a retirement fund during their active working life. These payments create a source of regular income for single mothers who might not have anyone to depend on financially.
ULIPs for accumulating wealth:
Similarly, single mothers can choose ULIPs to create a corpus for any financial goal that they have. These might include buying a vehicle, a house, going on a trip, etc. ULIPs, with their flexibility of partial withdrawals, can provide liquidity for short-term goals. For long-term goals, single mothers can enjoy compounded returns which allows their corpus to grow.
Although there could be multiple reasons why single mothers should buy ULIPs, these are some of the popular reasons.
Why women should invest in ULIPs?
Women might also invest in the plan to enjoy benefits of ulips. Here are some reasons which make ULIPs a good choice for women –
Financial security
The life insurance cover offered under ULIPs provides financial security to women who can be the main breadwinner of their families. Women can enjoy life insurance protection, which can give their families financial assistance in the absence of it, with the added benefit of market-linked investment returns -.
Planning for goals
Women might have different financial goals for which ULIPs can help them create a suitable corpus. For instance, women looking to save to buy their own car or house can choose savings-based ULIPs, with a flexible tenure to save, earn market-linked returns associated with risk, and grow their savings.
On the other hand, career-oriented women planning a financially comfortable retirement can use the policy benefits received or returns earned from ULIP post retirement for themselves. The plan would not only help in creating a market-linked fund, it would also ensure income throughout their lifetime to create a source of inflows after they retire.
Tax benefits
ULIPs are a tax-efficient way to create a corpus for your financial goals. They offer multiple tax benefits which can allow working women to reduce their tax liabilities. The tax benefits of ULIPs are as follows –
Premium paid qualifies as a deduction under Section 80C (in the case of the old tax regime) up to a limit of ₹1.5 lakhs, subject to specific terms and conditions3
The death benefit received is tax-free4
Switching between the ULIPs funds is also tax-free5
On maturity, the benefit received from the ULIP will be treated as a tax-free income under Section 10(10D) subject to specific terms and conditions6.
Achieving financial freedom with ULIPs
Single mothers and women can buy ULIPs for their respective needs and achieve financial independence with the various benefits that the plan offers. Whether it is creating a corpus for your goals, planning for your child’s future, or saving taxes, ULIPs offer these benefits and more. So, buy a suitable policy and secure your finances.
FAQs
What type of investment funds do ULIPs offer?
ULIPs offer different types of funds. However, the primary types of funds are as follows7 –
Equity funds – these invest primarily in equity
Debt funds – these invest in debt instruments
Balanced funds – these invest in a mix of equity and debt
Cash/money market funds – these invest in cash and money market instruments
Can I withdraw the fund value before the plan expires?
Yes, Unit Linked Insurance Plan allow the facility of partial withdrawal after the expiry of the lock-in period of 5 years from the date of policy commencement, subject to the terms & conditions of the policy 2.
An ISO 9001:2015 
