There comes a point in life where financial planning becomes absolutely essential for securing your financial future. Today, there are various financial products available in the market, which makes it increasingly difficult to pick a specific product. However, if you have short-term and long-term goals, financial planning will not be difficult.
Once your goals are set, it becomes easy to make an investment or buy an insurance plan. When you are researching to buy a plan, Unit Linked Insurance Policy (ULIP) seems to be your best bet. ULIP policy will bring many benefits compared to other plans or insurance. In this article, let’s take a look at some of the benefits that come with ULIP.
Dual benefits of a ULIP investment:
One of the many benefits of a ULIP investment is the dual benefits of insurance as well as investment. So, when you purchase a ULIP plan, you not only pay the premium for life insurance protection, you also invest in the fund of your choice. It provides extra guarantee and protection of your money.
Wide choice for investment:
Another advantage of investing in a ULIP is that it offers you a variety of investment options depending on your risk appetite.
So, if you are a low risk taker, you have debt funds to invest in
If you are a moderate risk taker, you have a well-balanced fund to invest in
If you are a high-risk taker, you may have equity funds to invest in
That way, you can experience the benefits and ULIP returns by investing heavily. Once you feel comfortable with this investment, you can invest more.
As with life insurance, ULIP offers a tax deduction on premiums payable. These tax benefits are paid under section 80C up to a premium of Rs 1.5 lakh. Exemption extends to all maturity pay-outs obtained under section 10D of the Income-tax Act, 1961. It will also allow you to save and grow your financial corpse. Unlike other alternative investments, the ULIP plan has no long-term capital gains tax effect. This makes ULIP a suitable insurance for tax exemptions.
In addition to these, there are several other ULIP benefits that make it an ideal investment option for both short-term and long-term financial goals. So, if you want to take advantage of market-linked growth and life-risk-cover, ULIPs are an excellent option to explore.