Why is a ULIP a Great Investment Choice for you
As an earning individual, you might have different financial goals at various stages in your lives. Buying a house or a vehicle, getting married, education expenses of your child, marriage expenses of your child, retirement, etc. are some of the common financial goals that you have to plan for. To meet all these commitments with ease, you need a well-structured financial plan.
Choosing your investments prudently is one of the first steps that you have to follow to devise a proper financial plan. Gone are the days when bank deposits and insurance plans used to be the main source of investment. Welcome to the era of ULIPs! A ULIP (Unit-Linked Insurance Plan) is a plan that gives you the double benefits of insurance and investment.
For example, when you invest in a ULIP from the LIC of India, the company uses a part of your payment as premium towards your life insurance policy. The other part of your payment is invested in various sources to give you maximum returns. Based on your risk profile, this amount is invested in equity funds, debt funds or a mix of both. If you still have any doubts about the usefulness of these ULIPs, here are the top reasons for investing in them. We are sure you will be convinced about these plans after reading this article.
- A ULIP is a great option if you are looking for long-term investment. Do you want to enjoy your life after retirement? Do you want to continue with your same lifestyle even though you would no longer get your salary? If yes, invest in a good ULIP as soon as you start working towards your retirement planning and keep investing an affordable sum in it every month. When you retire, the plan will mature, and you can get a lump sum payment in hand to enjoy your retired phase of life.
- When you have just started working, you are quite likely to be a low-risk taker. So, you would have chosen a ULIP that invests heavily in debt funds. However, once you get stabilised in your profession, you may become more open to taking a few risks. At this juncture, you would want to invest in more equity-based funds. This is where a ULIP is very helpful because it gives you the flexibility to switch your portfolio as and when you like, based on your risk appetite.
- When you invest in a ULIP, you not only get a life cover but also very good returns on your investment. However, that’s not all about these plans! You can also get to save a lot of money because these ULIPs qualify for attractive tax benefits as well.