5 Reasons Why ULIPs Can Help You Save For The Long-Term

The sole purpose of investing in a financial product is to achieve better returns. An investor always wishes to invest in products that yield decent revenues. If you also want to happen to you, you already would want to explore unit-linked insurance plans!

Apart from providing life insurance, Ulip also allows investors for different financial instruments like bonds and stocks. Given its 5-years lock-in period, it ensures higher returns. Take these reasons, for instance, as these (the ones mentioned below) offer clarity as to why these policies can save for the long-term.

  1. An Array of Flexibilities

Investing in these policies offers a slew of flexibilities starting from premium payments to a selection of funds. Single-premium plans are beneficial for investors having a large amount of money. On the other hand, regular premiums allow investors to pay their premium annually or monthly.

But the best way to build a large sum after the policy gets matured is by considering top-ups. It lets you manage the investment by switching between funds. The current policies bring strategic solutions where you invest on the basis of a host of criteria like goals, age, etc.

  1. Various Tax Benefits

The policy’s premiums can drive tax benefits, like major insurance plans under Income Tax Act Section 80C. ULIPs offer exclusive advantages for tax-free switches between debt and equity instruments, depending on the policy’s terms and conditions.

  1. Saves Systemically

When you start saving systemically, you open doors of opportunities to meeting your long-term goals. Take buying your dream house, child’s marriage/education, or retirement, for example!

Such a scheme demands investors to put their money regularly. Thus, retirement gets compounded. Ensuring higher returns is thus a great perk of buying these insurance plans.

  1. Facility for Withdrawal

If the demand for money arises, you get a chance to withdraw half their investment. On that front, neither do you have to borrow money nor consider liquidating your materialistic possessions.

But the only commandment to receive this partial withdrawal facility is the completion of a 5-year lock-in period.

  1. Dual Benefits

If there’s just one financial product that can give an option to invest & insure your life simultaneously, it’s none other than ULIPs. When you finally decide on investing in this insurance plan, it’s imperative to check for another product for the individual insurance requirements.

During the time of purchasing the policy, investors get a chance to select the sum assured. As a matter of fact, the sum assured happens to be the fixed amount that every nominee receives soon after your demise.

A Final Call

Thus, this post has mentioned all five reasons how this insurance plan can drive potential benefits. The features, as mentioned above, make unit-linked insurance plans the most attractive and useful financial products.

Given that these products invest the money in markets, it’s always recommendable to comprehend the structure of the product, charges, and the impact of market volatility on the investment corpus. With a set of customer-centric regulatory changes, ULIPs becomes a standalone low-cost investment choice.