ULIPs and Why You Should Invest in Them

Wealth management is crucial to achieving long-term financial milestones. It requires strategic planning and implementation. One of the most effective ways is to invest in a ULIP plan. It can help you meet certain responsibilities like a child’s education and marriage, paying off a mortgage, or solid retirement planning. The best ULIP plan is flexible to cater to the needs of the policyholder. For example, you can shuffle money between debt funds and equity as per your goals.
But it is important to understand what is unit-linked insurance plan and how it works. This can help you make a sound choice and pick a policy that is aligned with your goals.

What Are ULIPs?

A ULIP policy is divided into two parts. One is dedicated for investment purposes through funds and the other for insurance benefits. This way you can build a corpus along with securing the future of your loved ones. A death benefit is paid to the nominee if the policyholder passes away within the tenure. A maturity value is provided if you survive the term.
You do not have to manage the investment. An experienced manager will create the portfolio depending upon the market’s performance and your risk appetite. You can simply use a ULIP calculator to estimate the return from a plan.

Why Should You Invest in ULIPS?

It is a popular instrument in India for several reasons. ULIP benefits are in plenty and can match your long-term goals. Have a look:

Life Cover

This is a protective benefit offered along with your investment. It helps to keep your family financially afloat in your absence. This is offered in the form of death benefits to the nominees or beneficiaries. They will simply have to make a claim to the company followed by an easy and hassle-free process.

Life Goals
The invested amount gets compounded with a 5-year lock-in period. Therefore, this is a good option to clear long-term goals. It could include purchasing a new car, getting an international degree, or buying a property. Hold the policy for a longer timeline to maximize the ULIP returns.

Flexibility

The best ULIP investment offers flexibility to pick between two options: growth and balanced fund. You can pick according to your risk appetite.  Further, you can switch between funds and go for a partial withdrawal 6th year onwards. All of these can be done at your convenience without any high-end charges.

Affordable Premiums

The premiums start from as low as ₹2000 per month. You can use a ULIP calculator to understand how much premium you need to pay to achieve a financial target. Moreover, you won’t be charged any allocation charges. These are initial expenses charged by the insurer during policy issuance.

In all; a unit-linked insurance policy is an ideal choice for investors aiming to grow their wealth. Pick a company that offers an easy 3-step online buying process. Further, do understand the meaning and features of the ULIP plan properly, and read the product brochure and guide carefully for an informed choice.

ULIP calculator, ULIP plan
ULIP calculator, ULIP plan