Kotak e-Term Plan
Kotak e-Term Plan provides a high level of protection to your loved ones in your absence.
Kotak Guaranteed Savings Plan
Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality.
Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs.
Kotak Health Shield
Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability.
Kotak Lifetime Income Plan
Kotak Lifetime Income Plan gives you the security of your income continuing throughout your life and in your absence throughout your spouse's lifetime!
If you were to believe expert’s advice, then any investment is most fruitful when you start early. So, you will find most experts advising you to start investing as soon as you start working in your 20s. It is suggested to start your investment journey early in life for two reasons. You start early, you start low. It helps in accumulating funds over time. Another reason is that it helps in building a discipline of saving regularly.
When you talk about investment in your young years, Unit Linked Insurance Plans (ULIPs) are among the most loved plans among the youths of India. It offers them the dual benefit of insurance and investment and helps them save tax. Plus, they can also manipulate the investment strategy as per market trends, allowing them to make the most out of their investment.
Moreover, ULIPs offer various benefits and options for the policyholder to invest in multiple market-linked funds as per their risk appetite. In this article, we will discuss how ULIP is an excellent tool for early investing, the ULIP benefits for early investment, and how the benefits of early investment in ULIP can help you in long-term goals.
ULIPs are a great investment option for youngsters. It gives them time to build a corpus, save taxes, and help them get disciplined with the art of saving. Moreover, as the interest compounds, the sooner an investment is started, the higher the chances of yielding more interest is. In case of ULIP, the fund’s growth is often faster since it is a market-linked investment tool.
Let’s have a look at the top benefits of early investment in ULIP:
As you start investing early in life, you ensure that you are adding more years to your investment journey. These early years that you have added to your investment journey might not look fruitful at the beginning, but in a later stage of life, this will help you build a bigger corpus. So, if a person starts investing in their 20s, he can save way more till their 60s compared to those who start saving in their 40s.
You can use ULIP calculator to check the difference in the funds accumulated when you start investing in your 20s versus in your 40s. It is apparent that even when you invest a sum of ₹5000 per month in a ULIP policy offering a return of 8% when you start investing late and invest only for 15 years, you only accumulate around ₹17 lacs.
Whereas a youngster who started investing in their mid-20s (say since they were 25 years old) and kept investing regularly for 30 years accumulated a sum of ₹75 lacs at an interest rate of 8%. Thus, by the time he is 55 years old, he will have a massive corpus at his disposal compared to the person who started investing late.
We all know that life is unpredictable, and you cannot control it. But planning and being prepared for any unfortunate incident is a great way to ensure your family’s safety and financial stability. When you opt for ULIP at an early age, you confirm that your life is insured and that your family will remain financially stable even if something unfortunate happens to you. Also, when you take a life insurance at an early age, the premium amount is less, and you will get to avail more significant benefits.
ULIPs are a great tax savings tool. They offer an E-E-E model of tax savings where a policyholder is exempted from tax on premiums paid, proceeds, and maturity subject to Section 80C and Section 10 (10D) of the Income Tax Act.
Most ULIP policies allow partial withdrawal. This helps the policyholder financially in fulfilling any need or requirement as they grow. We all know that as we grow older, many needs arise, and having a fund at your disposal can be of great help.
ULIPs are a great way to learn to invest in a disciplined manner. ULIP policies have a minimum lock-in period of 5 years. When you start investing money as a youngster, you may feel like withdrawing the money time and again to fulfil even your slightest needs. When you opt for ULIP, you develop a habit over time of investing without withdrawing money and develop a sense to control your urge and focus on investment to fulfil your financial goals. Moreover, the 5-year lock-in period gives you a taste of accumulating funds which motivates you to save more.
So, there are many benefits of early investment in ULIP. Also, when you have a large retirement corpus at your disposal and other bonuses, you can quickly fulfil your wishes. Moreover, staying invested for a longer tenure can help you leverage the power of compounding. So, by starting to invest in early life, you are giving yourself a chance to stay invested for an extended period. However, before opting for any policy, you must carefully read its policy documents and guidelines.
In this policy, the investment risk in the investment portfolio is borne by the policyholder.