Why monthly investments in ULIPs make sense?READ MORE
Achieving our life goals allows us to lead a more fulfilling life. Be it retiring early, going for long vacations or saving for your child’s higher education, our dreams and aspirations demand smart investments. Unit Linked Insurance Plans (ULIPs) have emerged as one of the preferred investment options that allow you to invest in a range of market-linked funds in keeping with your risk taking capability and life goals.
ULIPs come with the dual benefit of protection and wealth creation. You can choose your funds under a ULIP plan as per your long-term financial goals and allocate your money in equity and/or debt funds accordingly, thus giving you the freedom to invest in the equity market as per your financial goals and also protect your family from life’s untoward situations.
The new-age ULIP is a flexible investment tool. The option of buying a ULIP plan online further allows you to invest at your own pace. ULIPs also offer tax benefits making them a must-have in your investment portfolio. Today, ULIPs are the only equity-linked investment tool which continue to be tax-free, thus further enhancing the returns on your investment and helping you move closer to your life goals.
So, why wait….go ahead and invest in a ULIP plan best suited to help you achieve your life goal.
ULIPs are one of the preferred plan for long-term wealth creation. Be it purchasing your dream home, plan to start your venture or saving for the higher education for your child, ULIP plan empowers you to save in a systematic and disciplined way. The five-year lock-in feature further helps you to save with a long-term view on your investments.
A ULIP plan comes with the dual benefit of wealth creation along with life cover. While the investment takes you closer to your life goals, the life cover in a ULIP plan ensures that your family members continue their journey towards their dreams and aspirations in case something happens to you.
ULIPs give you an option to invest in funds which are market linked. You get a choice of different funds like equity, debt, balanced etc under one ULIP policy. In this way, you can diversify your investment to ensure maximum returns. You can also check the past fund performance of all the funds on the company’s website which will further help you make informed investment decisions.
Through a ULIP plan you can invest in equity, debt or balanced funds depending on your risk appetite and life goals. That’s not all. You can leverage the Switching option in ULIPs to modify the asset allocation in keeping with your changing life situations and financial requirements. You can also avail the top-up opportunity to increase your ULIP premium amount to help you reach your life goals faster.
With ULIP policies you get tax benefit under Section 80C of the Income Tax Act, 1961 on the premiums paid by you. What's more the maturity benefit under a ULIP plan is also exempt from taxation under Section 10 (10D) of the Income Tax Act, 1961. Additionally, ULIPs continue to be exempt from Long Term Capital Gain (LTCG) tax, while other equity instruments came into the ambit of LTCG as part of Union Budget 2018
Who doesn’t like some extra benefits? Some ULIP plans have added features like Loyalty Additions and Fund Boosters if you remain invested for a longer period. This enhances the customer’s corpus on maturity. Further there are some new-age ULIPs that are returning the mortality charges deducted during the policy term to the customers on maturity. This is yet another feature that rewards customers for staying invested till the policy tenure and enhance their maturity corpus.
A key advantage of choosing a ULIP is that you can customize it as per your unique financial goals. The following factors will help you zero in on the preferred ULIP:
NAV or Net Asset Value of a ULIP is the value of each unit of the fund on any given day.
The formula used to calculate the NAV is as follows:
NAV = (Value of Current Assets + Market Value of Investments Held) – (Value of Current Liabilities & Provisions) / Total number of outstanding units on date
You can visit the website of your insurance provider and use NAV to determine the history of the fund performance and also to compare it with other funds.