Saving Plans Saving plans help beat inflation and build a large corpus. We at Insuredindia help you investment plans offered by life insurance corporation of India and select the best suited investment plan for you. An investment plan should be selected keeping in mind 3 main goals: Risk Profile-if you are a young customer and are willing to take financial risks, a ULIP is better suited for you while if you’re a conservative investor, then a traditional endowment or money-back plan will suite your needs. Investment Tenure – Insurance plans offer a mid-to-long term investment horizon. Unit Linked Insurance Plans or ULIPs are very good long term instruments. Final Goal – you want to build the corpus for retirement or child’s education? Top Investment Product Categories in Insurance: Traditional Endowment plans are regular saving plans which help build a corpus and give guaranteed maturity benefits along with bonuses. These products give you returns equivalent to a fixed yield/deposit but also combine insurance risk cover and add-on riders to primarily build the safety cushion in case something goes wrong. Moneyback Plans are a type of endowment plan which give periodic cash payouts to investors. As they help build regular large capsules of fund; they are very useful for salaried class who wish to save for buying large assets every 3-5years. Child Plans are saving instruments which help parents build a protected asset for their child’s future. They also provide many insurance features which protect the intent or reason for corpus building; primarily for child’s future education and expenses. Key things to remember while investing in an insurance plan Set financial goals - both short term and long term Maintain balance between risk and returns; allocate amount accordingly Investments should be both liquid and fixed. This enables you to use them in emergencies as well as avoiding overspending Start small and gradually increase invested amount. Choose premium payment options ranging from monthly to annual to single premium Research a lot before investing; use help of financial planner if need be Review portfolio each year and make changes accordingly Ask questions - Resolve all your doubts before investing. Use investment calculator to calculate exact premium before buying Avoid Over exposure to single market instrument Over-investing which could burden present finances. Many a time people invest more than what they can comfortably put aside after meeting regular expenses resulting in cancellations. The cumulative effect of such cancellation is losing your hard earned money in penalties. Tax Saving Investment Investment plans also make for good tax savings instruments. In life insurance, premium amount payable is deductible from taxable income up to maximum amount of Rs 1 Lac under Sec 80C. Maturity proceeds and death benefits are also tax exempt under Sec 10(10D). Insured India
Posted on: Wed, 03 Jul 2013 08:36:48 +0000
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