How will the money be invested with ICICI Pru SmartKid Plan?
ICICI Pru SmartKid plan is one such plan that provides market-linked returns along with a life cover`. The returns from the plan can enable your children achieve their goals and the life cover` can ensure that they are financially protected, no matter what. This plan also comes with a Smart Benefit wherein in case of an unfortunate demise of the life assured, the premiums are waived off and units equivalent to the instalment premium will be allocated by the Company on the subsequent premium due dates. The plan provides various options by which your money can get invested. Read on to know more.
ICICI Pru SmartKid plan provides you the flexibility to invest your money in 15 different fund~ options. You can invest in equity funds, debt funds, or a balanced fund as per your choice and your risk appetite. You can either select the funds you want to invest in through the Fixed Portfolio Strategy or you can choose the automatic allocation through the Lifecycle Based Portfolio Strategy 2. Let us understand these strategies in detail.
Fixed Portfolio Strategy
In the Fixed Portfolio Strategy, you have complete control of choosing the funds you want to invest in throughout the duration of your plan. It also provides you the flexibility to decide the percentage of your premium that you want to allocate to each fund. You can also switch between the 15 funds~ during the tenure of your plan. This allows you to take advantage of market fluctuations and increase the returns from the plan.
Within the fixed portfolio strategy, there is an additional Automatic Transfer Strategy. This strategy lets you transfer your investment from debt funds to equity funds every month. This helps to protect your investments from short-term market fluctuations. This also provides you the security of debt funds and the better earning potential of equity funds.
Lifecycle Based Portfolio Strategy 2
- Age-based portfolio management
- Safety as you approach maturity
In the Lifecycle Based Portfolio Strategy 2, your investments are automatically made as per your age and changing life needs. Here is how it is done:
Your money is invested in a high return-generating equity fund, the Multi-Cap Growth Fund and a low-risk debt fund, the Income Fund. The percentage of investment in each fund depends on your age. The younger you are, the greater is your risk appetite. In your early years, a greater percentage of your investment goes into the Multi-Cap Growth Fund, and the remaining is invested in the Income Fund. As you grow older, your risk appetite reduces. As a result, your investment in low-risk debt fund, the Income Fund is increased.
The below table shows the allocation of the funds based on your age.
| Age in years | Multi Cap Growth Fund (Equity) | Income Fund (Debt) |
|---|---|---|
| 20-25 | 80% | 20% |
| 26-35 | 75% | 25% |
| 26-45 | 65% | 35% |
| 46-55 | 55% | 45% |
| 56-65 | 45% | 55% |
As your policy nears its maturity date, you need to ensure that short-term market volatility does not affect your accumulated savings. In order to achieve this, your investments in Multi-Cap Growth Fund will be systematically transferred to Income Fund in ten instalments in the last ten quarters of your policy.
ICICI Pru SmartKid plan provides you the opportunity to leverage the earning potential of the market to earn greater returns. The portfolio strategies offered by the plan provide you the flexibility to choose the way your money gets invested. The plan provides you complete control on your investment, at the same time, covers your children in case of any unforeseen event. The plan helps to ensure that the dreams of your children are protected, no matter what.
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