What is wealth management?

The first thought you might come across while thinking about wealth management can be, a personal banker helping to create an abundance of wealth for an affluent individual.

However, it simply means managing investments for all kinds of investors, to offer them better returns. If taken into consideration, wealth management or money management grows your money exponentially and helps you achieve your long-term financial goals like your dream house, your child's education, your retirement, and much more.

How does wealth management work?

Wealth management is primarily about financial planning and offering better returns on investments. Since the principle of wealth management lies in the long-term preservation of funds, this is how wealth management works:

  • The first step is for your wealth manager to understand your financial goals, time horizon, and risk appetite.
  • The second step is to come up with a suitable plan for you. This involves suggesting the right strategies, products, and investments for you. The wealth manager also takes into consideration your liquidity concerns, tax liabilities, and current as well as past investments.
  • The third step is to execute the plan. The money is invested in the financial instruments of your choice and your investment strategy is implemented
  • The last step requires evaluating and modifying your plan from time-to-time, as per your changing needs.

What are the features of wealth management?

  • Wealth management is tailor-made and client-specific. So, the products and investment types are suggested based on your preferences. Your risk appetite, timeline, liabilities, assets, etc., are kept in mind before devising a plan of action.
  • The job of a wealth manager is not limited to advising alone. Instead, they offer several financial services, such as managing your wealth, finding opportunities to create more wealth, and revisiting your plans after periodic intervals.
  • Wealth management involves using a variety of aspects to not only manage your wealth but also to align with your family’s needs. Some of the duties of a wealth manager include tax management, retirement planning (annuity plans), personal finance management, and insurance planning (term, health, endowment, unit-linked plans and more).
  • Wealth managers are experts in specific fields of finance. So, they offer their professional expertise in many unique areas to create wealth.

The insurance plan preferred by wealth managers - ICICI Pru LifeTime Classic*

ICICI Pru LifeTime Classic is an ideal plan chosen by wealth managers for long-term wealth creation. This unit-linked investment plan+ offers you two major benefits – Financial protection to your loved ones in the form of a life cover as well as the opportunity to create significant funds for your financial goals.

The plan offers 4 portfolio strategies, and you can choose any of these as per your goals and risk appetite. You can choose between equity, balance and debts funds, and switch between these funds at any point in time, without any additional charges. In addition to this, the plan rewards you with loyalty additions^ and wealth boosters` for staying invested for a longer period and paying all your premiums without any defaults. This considerably adds to your overall earnings. You can also choose to pay the premium monthly, half-yearly, yearly, or stick to a one-time payment. Lastly, you get tax benefits of up to ₹46,800# on the premiums paid, under Section 80C of the Income Tax Act of 1961.

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* This is not a product brochure. For more details on the risk factors, terms and conditions, and the charges and benefits related to Surrender, Premium Discontinuance, Revival etc., please read the sales brochure carefully before concluding the sale. Past performance is not indicative of future performance.

+ Unlike traditional products, unit linked insurance products are subject to market risk, which affect the Net Asset Values and 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. This is a unit linked insurance plan. In this policy, the investment risk in investment portfolio is borne by the Policyholder. 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. On surrender after completion of five years the surrender value will be the Fund Value including Top Up Fund Value, if any.

^ Loyalty Additions: Each Loyalty Addition will be a percentage of the average of daily Fund Values including Top-up Fund Value, if any, in that same policy year. Loyalty Additions will be allocated among the funds in the same proportion as the value of total units held in each fund at the time of allocation. The allocation of Loyalty Additions is guaranteed and shall not be revoked by the Company under any circumstances. If the premium payment is discontinued any time after 5 years, the number of years for which premiums have been paid will be considered as the premium paying term for the purpose of deciding the Loyalty Additions to be paid for the rest of the policy term.

` Wealth Booster: Each Wealth Booster will be equal to a percentage of the average of the Fund Values including Top-up Fund Value, if any, on the last business day of the last eight policy quarters.

Wealth Booster will be allocated between the funds in the same proportion as the value of total units held in each fund at the time of allocation. The allocation of Wealth Booster units is guaranteed and shall not be revoked by the Company under any circumstances. If the premium payment is discontinued any time after 5 years, the number of years for which premiums have been paid will be considered as the premium paying term for the purpose of deciding the Wealth Boosters to be paid for the rest of the policy term.

# Tax benefits of ₹ 46,800 u/s 80C is calculated at highest tax slab rate of 31.20% (including cess excluding surcharge) on life insurance premium u/s 80C of ₹ 1,50,000. Tax benefits 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.

E/II/2706/2020-21

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