What is the meaning of long term investments?

Long term investments refer to investments that are held for one year or more. Long term investment plans tend to offer greater returns when held for a longer period of time. They are generally used to cater to future needs such as education expenses for your child, post-retirement goals, and more.

How to plan for a long term investment?

Long term investments can be planned on the basis of your goals, current income, and the expected returns from your investments. For instance, if you are in your 30s and saving for retirement, you have approximately 30 more years to build wealth before you retire. However, if you are saving for your child’s college, you would have a shorter investment term of 10 to 15 years. The investment plan, hence, will vary accordingly.

 

7 Benefits of Long Term Investments
  • Power of compounding:

    The more time you give your investments to grow, the higher the returns will be. For instance, a small amount of ₹ 500 invested monthly at a 15% rate can grow to ₹ 16.42 lakh after 25 years
  • Security from short-term volatility:

    It is difficult to predict the market conditions correctly, hence in order to get maximum benefits, it is good to invest for the long-term. By staying invested for a longer duration, you can overcome short-term volatility
  • Goal-centric planning:

    As you are investing for the long term, you can use it to plan for significant milestones like buying a house, child’s education, retirement, and more
  • Convenience:

    You don’t need to worry about the investment due date. You just need to send a one-time instruction to your bank to facilitate Auto-debit from the bank account or credit/debit card. In addition, you can buy long term investment plans online with a few clicks* of the mouse anytime
  • Tax benefits~:

    Long term investment plans make it easy to do tax~ planning every year. All you need to do is buy a long-term investment plan and invest regularly to avail tax benefits~ as per the Income Tax Act, 1961. It means, you not only grow your money but also save tax~
  • Lesser effect of market fluctuations:

    Small market fluctuations do not impact long term investment plans as much as they affect short term investment plans. Hence, you can stay worry-free with long term investments
  • More time to try different funds for maximum returns:

    Long term investments give you enough time and opportunity to switch between different funds and make up for any non-performing fund

When you buy ULIPs as a long term investment option, you can enjoy all the above-listed benefits and much more.

  • Flexible investment options:

    ULIPs give you the flexibility to invest in different fund options— equity, debt, and balanced funds— as per your risk appetite. They also let you switch between funds as per the market condition. Staying invested for a longer duration with a switching option can help you reap maximum benefits.
  • Goal-oriented planning:

    As there is a minimum lock-in period of 5 years, you can use ULIPs to fund your long-term goals, like buying a house, funding your child’s higher education, retirement, etc.
  • Loyalty additions^:

    By staying invested for a longer duration, you can earn loyalty additions^ which grow your money without any further investment.
  • 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 cover`:

    Besides growing your wealth, ULIPs are useful in securing your family’s future in your absence. In the case of your sudden demise, your nominee will get a lump sum amount to secure their 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 the free quotes of 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 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 for a callback.
For instance, if you are planning to invest in ULIP ICICI Prudential Smart Kid Plan to save for your child’s education, here’s how you can buy this policy online:
  • Simply visit the ICICI Prudential Life website
  • Visit the ICICI Prudential SmartKid Plan page
  • Click on Buy Now
  • Click on Create Your Plan, enter the details, and click on submit

When to choose long term investment above short term investment?

Long term and short term investments serve two very different purposes. Long term investment is more lucrative over time. These plans are ideal if you are saving for your long term goals, such as your child’s education or wedding, purchase of a house, retirement, and more. They let you build a large fund over the years. They also offer tax benefits~ that further contribute to your savings.
Short term investments, on the other hand, can be used to meet short or medium-term goals, such as buying a car, travelling or paying off debts. Short term investments can offer rewards in a short span of time, but they can also lead to higher taxes.

1. What are Long Term Investments?

A long-term investment usually includes assets/investments that are non-current in nature and are held for a period of one year or more. Stocks, bonds, savings/retirement plans and real estate are some mediums through which you can make a long-term investment. Typically, a long term investment is made to meet needs such as your child’s education, marriage, and others.

2. What are the types of investment options for the long term?

There are several long term investment options. You can select one based on your financial goals or planning. These include Unit Linked Insurance Plan (ULIPs), Equity Funds, Public Provident Fund (PPF), Stocks, Mutual Funds, Bonds, Gold and Real Estate. All these investment options ensure long term gains.

3. Are long term investment plans safe?

Long term investment plans are absolutely safe and secure. These investments tend to grow as time passes by. Besides, the probability of missing out on some benefits due to the unpredictability of the market is eliminated when it comes to a long term investment. Make sure you are clear on all the terms and conditions before making a long term investment.

 

~ Tax benefits are subject to conditions under Section 80C, 10(10D), 115BAC and other provisions of the Income Tax Act,1961. Good 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 above.

*Subject to realisation of payment and documents.

`Life cover is the benefit payable on death of the Life Assured during the policy term.

Unlike Traditional Products, Unit-Linked Insurance Products are subject to market risk, which affect 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.

ICICI Pru Smart Kid Plan with ICICI Pru Smart Life UIN 105L145V06

ICICI Pru Life Time Classic UIN 105L155V06

ICICI Pru Guaranteed Wealth Protector UIN 105L143V02

W/II/4875/2021-22

Long Term ULIP Plans
ICICI Pru LifeTime Classic

Premium starts at `2500/- p.m.

ICICI Pru Smart Kid Solution

Premium starts at `3750/- p.m.

ICICI Pru Guaranteed Wealth Protector

Premium starts at `2000/- p.m.

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