Monthly Investment Plans today are one of the most preferred types of investment options. Most salaried people earning a monthly income prefer this mode of investment. Let’s see why.
5 benefits of Monthly Investment Plans
- The Power of Compounding: It is said that the power of compounding is the 8th wonder of the world. Since the returns from your investment depend directly on how long you are invested, it is vital to start as soon as possible. Mr. Amit understood the importance of this when he earned `88,000/- more by starting his investment just 2 years earlier than Mr. Balaji.
For example, Mr. Amit started investing `2,000/- monthly today & 7 years later, his investment grew to `2.44 lakh with the power of compounding. Whereas, Mr. Balaji started investing 2 years later, and his investment grew to only `1.56 lakh. Mr. Balaji could have earned `88,000/- more had he not delayed his investment by 2 years.
- Rupee Cost Averaging: It is impossible to time the market for the best time to invest, and that is why most people tend to delay their investments. Monthly investment plans use rupee cost averaging, which does not require the investor to wait for a good time to start investing. Rupee cost averaging, evens out market ups and downs in the long run and allows you to get a better return on the investment over a period of time. By investing a fixed amount of money every month, you buy more units when prices are low and fewer units when prices are high. Therefore your final weighted average cost remains lower than the average unit price.
- Convenience: You can send a one-time instruction to their bank to facilitate auto-debit from your savings account, credit card or debit card. You can, thus, make investments without worrying about missing the investment due date. You can even buy monthly investment plans online in the comfort of your home. It would just take about 10 minutes of your time.
- Disciplined Saving: Discipline is the most important thing when it comes to making any investment. Many times, people start investing with great enthusiasm but fail to keep pace with time. Instead of investing a lump sum amount, you can invest a smaller amount every month, which is easier to do. Since monthly investments happen automatically, you don’t need to interfere regularly. You can continue saving for a long time, and your money can grow a lot faster.
- Tax Planning~: Monthly investment can make your tax-saving~ targets easy to achieve every year. All you need to do is to buy a monthly investment plan, set up auto-debit instructions online, and you are good to go!
When you choose Unit Linked Insurance Plans (ULIPs) as your preferred monthly investment option, you get all this and more!
4 reasons why people choose ULIPs as their preferred monthly investment option
- Affordable premiums: With ULIPs, the minimum premium starts from as low as `2,000/- per month.
- Fund switches: To make the most of your investment you can switch your money between funds at will.
- Partial withdrawal$: Starting from the sixth year, you can withdraw up to 20% of your investments in ULIPs provided monies are not in the Discontinued Policy Fund to meet any future needs and let the remaining investment grow.
- Life Cover1: With a life cover1 in-built in ULIPs, you get much more than just a great investment option. In case of an unfortunate event, your family will be paid a lump sum to secure their financial future.
How to buy online?
Investing in any of the long-term investment products like ULIPs is now only a few clicks* away. You can generate free quotes for a long-term investment plan by putting in information like gender, age, mobile number and email id. Once you are satisfied with the policy quotes, click on them to reach the policy application form where you have to give details like identity proof and bank account information to buy the plan. In the case of any query, call the customer support centre or request a callback.
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*Subject to realisation of payment and documents.
~Tax benefits are subject to conditions under Sections 80C, 10(10D), 115BAC and other provisions of the Income Tax Act, 1961. Goods and Service Tax and Cesses, if any, will be charged extra as per prevailing rates. Tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details, before acting on the above.
Unlike traditional products, Unit Linked Insurance Products are subject to market risk, which affects the Net Asset Values & the customer shall be responsible for his/her decision. The names of the Company, Product names or Fund options do not indicate their quality or future guidance on returns. Funds do not offer guaranteed or assured returns.
^Loyalty Additions are applicable from the 6th policy year onwards. This is in the form of extra units at the end of every policy year. Each Loyalty Addition will be equal to 0.25% of the average of the Fund Values on the last business day of the last eight policy quarters. You get an additional Loyalty Addition of 0.25% every year from the end of year 6 if all premiums for that year have been paid. Wealth Boosters will be allocated as extra units at the end of every 5th policy year starting from the end of the 10th policy year. Each Wealth Booster will be 3.25% for Regular Pay Policies and 1.5% for Single Pay Policies of the average of the Fund Values on the last business day of the last eight policy quarters
$Systematic Withdrawal Plan is allowed only after the first five policy years.
Unit Linked Insurance Products do not offer any liquidity during the first five years of the contract. The policyholder will not be able to surrender/withdraw the monies invested in Unit Linked Insurance Products completely or partially till the end of the fifth year.
1Life cover is the benefit payable on the death of the life assured during the policy term.
ICICI Pru LifeTime Classic UIN: 105L155V07
ICICI Pru Smart Life UIN: 105L145V07
ICICI Pru Guaranteed Wealth Protector UIN: 105L143V02