Investment plans should always have a firm plan and that is precisely what you get when you invest in Unit Linked Insurance Plans – it is a combination of insurance and investment. While many have reasons to think of the reasons to invest here, the honest idea is quite simple. Because it has elements of insurance as an aspect of it, you are in it for the long term. Just like you would with an insurance policy for your child or an investment for your child's wedding perhaps. It is long term and has plenty of benefits. What are they? Let's find out.
1. You are protected: With a volatile market and not much to guarantee on economic conditions, there is a severe need to be sure of the goal you have in mind. Irrespective of the policyholder, your investment is safe. The final target which you had with the investment is cleared out in the event of death or at the period of maturity. You are safe from fluctuations and that keeps you protected.
2. Tax exemptions: We are all struggling to reach our exemption limits with respect to tax. If your total investment is to a level of Rs 1 Lakh, this would be deductible and also the amount you get on maturity is tax free. Do note that this is applicable if the total premium paid is not over 20% of the insured amount.
3. Flexibility: Not all investments give you this opportunity and with ULIP, you have just that. You can switch without any thought and that means a seamless and tax friendly method. You can do this at any time and change your portfolio in many ways.
4. Long term thinking: Anyone who is planning to invest here should be thinking of exiting only after 12-14 years. That is a long time and the dividends come out only in such periods. When you enter this investment, you are protecting your long term goals and that gives you so much more than any short term investment.
