Every person looks forward to a comfortable retirement after years of hard work and sacrifice. However, not every retired person gets this simple wish – and this is all down to lack of planning at the right time. This article addresses the all-important question of retirement planning through ULIPs.
A reality for all
As we work through the daily grind, one thought remains crystal clear: what comes after all this, what do you envision for yourself one you are retired? Do you see yourself travelling to exotic places? Do you wish to move from the hustle of the city and move to a quiet town? These thoughts vary for us all, but the core point is: we all want to be relaxed and free from troubles in our later years.
The Current Scenario
How can we ensure that we get to enjoy these benefits? The truth is as we age, our ability to be employed is also decreasing. But the expenses are all in the horizon, steadily increasing with inflation. Hence there is a lot of thought needed to be added while planning for your retirement. Any retirement calculator online will show scary figures that will dishearten you; but the key to escaping it is systematic financial planning.
Retirement Planning through ULIPs: Here comes a saviour
Systematic Investment Plan (SIP) is a process of investing through steady investments in funds of your choice. Pay a fixed amount every month/year and it is then invested in market-linked funds of stocks, bonds, etc. It is the often underrated fund that has the ability to accrue massive payouts, and is often clubbed with mutual funds. It has eliminated many of the costs while providing you the liberty to invest based on your risk level.
Savings for the long-run
SIP entails a clear, constant set of investments. These investments need to be done regularly. This inculcates saving habit in the investors and which only leads to long term financial growth. This investment is better than a lump sum payment since it weathers market lows very well. SIP is the kind of investment that works for customers no matter where they fall on the risk scale. Thus, it is an ideal retirement investment plan when you start early.
Exempted from tax
Your premium is deductible from your income up to 1.5 Lacs under section 80C of the Income Tax Act. The payout is also completely tax deductible under section 10D(D). So, imagine your years of hard work truly do not go to waste, and you reap the full rewards of your investment. The amount you put in grows multifold and then you are free to realize all your dreams, without giving up a single rupee for tax or extra charges. New age ULIPs like Edelweiss Tokio’s Wealth Plus, have a zero cost structure which gives greater benefits.
Know yourself and your needs
At the end of the day, you need to be certain of your needs, and the sum you envision saving for your retirement. It is always better to be sure as early as possible. Since investments need a certain amount of time to grow, you need to be prudent and invest steadily. As with all things it only needs initiative and the courage to invest.