Benefits of Investing in ULIP Plans at Early Age

Benefits of Investing in ULIP Plans at Early Age

Seema Gurnani | @indiablooms | 13 Mar 2019, 07:57 pm

An early bird catches the worm’ is an old yet relevant saying for ULIP investment plan 2019. In actual sense, it means the early an individual starts something, the more advantages he/she gets and when we consider this phrase for investment plans, it proves to be true as well. The earlier you start investing, the more time you give to your invested money to grow. Therefore, the early you start investing for your life goals, the more benefits you will achieve from your investment.

Here we are discussing some of the benefits of investing in ULIP plans:

You get the power to compound your investment: The main rule to increase your investment is to invest your money for the long term. It is seen that the longer you stay invested, the higher the wealth you accumulate. Therefore, by investing your money in ULIP investment plan 2019 for at least 5 years of lock-in period, you allow it to grow because of its ability of compounding.

As a young investor, you have higher risk appetite and hence more potential to invest: When you are young, you do not have responsibilities which consecutively increase your risk appetite. You do not have to think much before investing your money as you do not have much of liabilities in your 20s and this makes you a potential investor at a young age. In this way, you can go for ULIP funds that have higher exposure in the equities. More you invest in equities the more you become exposed to risks when the market becomes volatile. However, the higher the risk, the more are the chances to get a reward. Some past records show that equities have outperformed than other asset classes in long term included in ULIP investment plan 2019.

You get a higher corpus out of your investment: The compounding nature of ULIP plans enables you to accumulate a higher corpus; if you keep investing your money for a long time and hence help you fulfill your future goals. For example, you start investing in ULIP plan with Asset Allocation II that has investor selectable portfolio at the age of 25 years by paying Rs.5, 000 every month for approximately 20 years. In this case, when you see your corpus at 45 years, you will get approximately Rs.23 Lakh at the rate of 8% returns per annum and Rs.13 Lakh at the rate of 4% per annum returns. On the other hand, if you start investing in the same plan at the age of 35 years, then your corpus at the age of 45 years will be around Rs.8.3 Lakh at the rate of 8% per annum returns and Rs.6.8 Lakh at the rate of 4% per annum return. In this way, the longer you invest your money in ULIP investment plans 2019, the more amount you will accumulate.

You develop a habit of systematic investment: Developing the habit of savings from the beginning of your career enables you to reduce the load of a higher yearly or monthly contribution to fulfilling your future goals. If you are lucky to get an early job opportunity, then it is suggested to start investing as soon as possible so that you can easily fulfill your future goals. In this way, being young gives you the biggest benefit of time and hence by starting to invest at an early age gives you the opportunity to meet your life goals more comfortably than those who invest at later ages of their life.

Summing It Up!

ULIP investment plan 2019 offers you the opportunity to float your investment types in the volatile money market. You always have a chance to switch from one fund option to others according to the moments and outlook of the market. Some insurance companies give you the chance to make free innumerable switches among the funds. However, there are some insurance providers that offer only some free switches every year and exhaustion of these switches; you have to pay some money for making any alternations in your funds selected. So, even though you get the opportunity to switch, but check the number of free switches provided before performing any action.

In addition to this, if you stay invested for a longer period of time, you can easily accumulate higher corpus.

Benefits of Investing in ULIP Plans at Early Age

Seema Gurnani
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