Life can be unpredictable, and no two days are the same. With age, increasing responsibilities, changing needs of your family members, rising health concerns, etc., your financial needs can also alter with time. Hence, it becomes important to have a dynamic investment plan that can keep up with your demands at every stage of your life.
A ULIP plan can be a perfect choice here. You invest your money as per your unique life stage and need, and reap the desired returns at the right time with a ULIP Policy.
Additionally, avail of different ULIP fund options that can be chosen on the basis of your risk appetite. You can also switch between these fund options as per the fluctuations in the market and ensure that you earn high ULIP returns that can counter inflation.
ULIP benefits make for a long list, some of which have been discussed in this article. Read on to know more.
ULIPs for changing life stages
One of the most significant ULIP benefits is that the product can be used at any life stage. A ULIP plan can be bought for a wide range of financial goals, such as retirement costs, home purchase, education expenses, and more. You can choose an appropriate policy term and earn returns on your invested capital with the right combination of ULIP funds. Here’s how this works:
1. ULIPs enable goal-based investing: Depending on your age and life situation, you may have different financial needs at different times. For instance, in your 20s, you might want to save for your wedding expenses. In your 30s, you might want to save for the future higher education needs of your children. And in your 40s, you might want to save for your retirement dream home. Your needs and wants are bound to change with age.
A ULIP policycan accommodate all of these changes and offer you fund options and policy tenures that fit right into your needs. For instance, you can pick a long policy tenure and equity funds for retirement. These ULIP funds may offer the highest returns. And even though the risk involved is high, the long term till retirement enables you to ride out the risk and make up for any losses suffered during the term.
2. ULIPs let you switch between funds: The option to switch from one fund to another make ULIP funds a great choice. A ULIP investmentoffers diverse fund options as per your risk capacity and goal.
For instance, equity funds are ideal for young investors who have little to no liabilities and responsibilities. They can afford to take on more risk and hence can invest in equity funds to garner higher rewards. On the other hand, older investors can slowly turn to debt and balanced funds for a more conservative approach to investing.
This offers stable ULIP returns and minimizes the chances of experiencing a loss. No matter what life stage you are in, you can modify your portfolio with suitable funds as and when you want.
3. ULIPs keep you protected: The life cover feature of a ULIP plan keeps you protected at all stages of life. This ensures your family’s financial security against all possible costs in your absence. In the unfortunate event of death, the sum assured or the prevailing fund value is paid to your loved ones. This allows them to cover their costs and live a dignified life.
Wealth Secure Plus by Edelweiss Tokio Life Insurance
The Edelweiss Tokio Life Insurance ULIP plan – Wealth Secure Plusoffers many useful features that make this ULIP policy ideal for every age and stage of life. Some of the plan’s features include the following:
o Choice of seven funds: The plan offers a total of seven fund options, such as:
§ Equity Large Cap Fund
§ Equity Top 250 Fund
§ Equity Mid-Cap Fund
§ Managed Fund
§ Bond Fund
§ Equity Blue Chip Fund
§ Gilt Fund
o A fund for every risk type: Each of these seven fund options cater to a specific type of risk that be used as per your age and requirements, such as:
§ Funds suitable for a high-risk appetite: Equity Large Cap Fund, Equity Top 250 Fund, Equity Mid-Cap Fund, and Equity Blue Chip Fund
§ Fund suitable for a moderate risk appetite: Managed Fund
§ Fund suitable for a low-risk appetite: Gilt Fund
o Different types of strategies: You can choose from two types of strategies as per your life stage and investment choices:
§ Self-Managed Strategy: With the Self-Managed Strategy, you can get unlimited switches and can decide where you want to put your funds yourself.
§ Life Stage or a Duration-Based Strategy: With the Life Stage and Duration Strategy, the company picks the right funds for you based on your goals and life stage.
To sum it up
No matter your life stage, you can always align your risk appetite to your financial goal and earn suitable returns from a ULIP plan. However, keep in mind to pick a credible insurance provider and stay invested in the plan for the long term. This can enhance your overall returns.
Aastha Mestry - Portfolio Manager
An Author and a Full-Time Portfolio Manager, Aastha has 6 years of experience working in the Insurance Industry with businesses globally. With a profound interest in traveling, Aastha also loves to blog in her free time.