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In this policy, the investment risk in the investment portfolio is borne by the policyholder.
Kotak e-Invest
Features
Ref. No. KLI/22-23/E-BB/492
A ULIP provides insurance coverage while also offering profits through investment fields. Read this blog to understand why ULIP is a good investment.
Creating wealth and building assets is an important component of financial planning in your life. Designing a financial investment portfolio that delivers considerable returns to you over time is one of the most practical and successful methods to secure your financial future and achieve long-term financial goals.
When it comes to setting up your financial portfolio, it is no secret that mutual funds, insurance policies, and other financial instruments are popular choices. However, what if you had the opportunity to invest in an instrument that provides both investment and market-related returns in one?
A ULIP portfolio is unique in itself. It is an investment that is split into two halves and involves a five-year lock-in period. The first portion is used to secure life insurance coverage by paying a premium. The remaining money is invested in either equities or debt funds in order to gain financial rewards. You can increase or reduce the percentage of your ULIP assets in favor of your insurance cover or into your investment portfolio, depending on your future financial goals. In either case, you will undoubtedly reap substantial financial gains.
ULIPs offer a unique blend of insurance and investment, making them a compelling addition to your financial portfolio. It is now time to understand the reasons why you should consider adding ULIPs to your investment mix.
In India, ULIP is the only unique financial product that provides a dual advantage of investment and life insurance coverage through a single investment. As a result, you won’t need to purchase separate insurance and investment plans. to protect your future.
Purchasing a new ULIP and renewing the old one takes very little time. On most occasions, you can buy your preferred plan online from the convenience of your own home. All you have to do is go to the insurance company’s website, pick a plan, send in your KYC papers, and make the purchase.
Depending on your risk tolerance, you can move your money between different funds, such as equities, debt, and balanced funds. You can raise your investment part in equity funds if you wish to adopt a high-risk approach to your investing. You can also convert your assets into debt or balanced funds at any time if you wish to reduce your risks.
As your life progresses and you make more money, you can redirect some of it to your investments. You can top up your investment at any moment with a premium top-up option, making ULIPs an excellent addition to your portfolio.
All effective ULIP uses the power of compounding plans to help you enhance your net worth. When you put your money in the stock market, it grows and provides rewards that can help you overcome inflation. In reality, the longer you invest, the higher your returns will be.
ULIPs come bearing tax benefits as well. Premiums paid for ULIP are exempted from tax under section 80C of the Income Tax Act, 1961, including the maturity benefit that is also tax-free as per Section 10 (10D).
Starting your investments in ULIPs early is highly advisable. ULIPs can offer significant growth potential, depending on your choice of funds. Given that ULIPs typically have a lock-in period of up to 5 years, this time frame allows your money to accumulate returns and appreciate in value. Extending your investment beyond five years can further boost the likelihood of substantial growth.
It is crucial to note that ULIPs double as life insurance products, and commencing your investment journey at a young age can lead to lower premiums. Beginning early also provides you with a more extended investment horizon, affording your money ample time to mature.
Unit Linked Insurance Plans have come a long way, emerging as a versatile financial product that combines insurance protection with investment opportunities. With their dual benefits, flexibility, transparency, tax advantages, and long-term wealth creation potential, ULIPs can be a valuable addition to your investment portfolio.
However, it is essential to carefully assess your financial goals, risk tolerance, and investment horizon before investing in ULIPs, ensuring that they align with your overall financial strategy. Consulting a financial advisor is advisable to make informed decisions and maximize the benefits of ULIPs in your investment journey.
Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.
Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors
In this policy, the investment risk in the investment portfolio is borne by the policyholder.
Kotak e-Invest
Features
Ref. No. KLI/22-23/E-BB/521
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.
