Like the many dishes in a thali, understand the importance of ULIP in your portfolio

1st December 2017

A food-crazed nation like India has a number of dishes originating in diverse cultures. Foodies like to get their knowledge about the food before sinking their teeth in.Likewise, investors should draw this inquisitive trait of foodies, when it comes to evaluating their investment decisions.

What goes in the thali?

Consider the thali – a popular dish, or rather series of dishes.It is not uncommon to find a thali that bears the signature of a region or culture.So, we have the Gujarati thali, Maharashtra thali and Rajasthani thali, among others.

Typically, a thali includes rice, dal, vegetables,curd, chapati, with a little chutney/pickle thrown in.At the end there is dessert which serves as a sweet reminder for another go in the future.

The thali has everything in proportion.It’s as if the chef took pains to understand the needs of both – the health as also the palate.

There are greens, there are pulses, there is milk (curd or lassi), there is a chutney/pickle to spice things up a bit.The dessert at the end, sweetens the deal further.

You would be hard put, to find a better-rounded dish than the Indian thali.

Investments that satiate a different hunger

A wise investor can take a lot from the thali, apart from the food.

The construct of the thali, the number of items, the balance across the ingredients with an eye on health as also the taste buds.

A prudent investor looks for the same well-rounded edges in his investment.He wants his money to take him as far ahead as possible.Simply put, he wants his investment to achieve multiple goals at the same time – think one thali, many dishes.

ULIP – An investment thali brimming with options

ULIP offers individuals the opportunity to select a product in harmony with their risk profile and investment objectives.Thanks to the large number of plans/options, the individual can buy a ULIP that represents his profile and is like a signature of the individual.Think Gujarati foodie – one who opts for the Gujarat thali and so on.

For instance, an investor with a high risk appetite can opt for ULIPs offering a fund with high equity component.The moderate risk taking investor will eye the balanced fund ULIP, since it has equity and debt in roughly the same measure and sits well with his profile.

Like the foodie ogling over the dishes in the thali, understand what ULIPs bring to the table.

  1. ULIPs offer the opportunity to create wealth through investments in capital markets(equities and debt)
  2. They offer a life insurance cover
  3. They offer diverse fund options/plans targeting different investor segments in the same plan
  4. There are several portfolio strategies allowing investor to pick the most suitable investing style
  5. Higher premium allocation(as mandated by the insurance regulator) which means a larger portion of your premium is working for you
  6. You have the option to decrease the Sum Assured
  7. You can avail unlimited fund switches in ULIPs
  8. Those pressed for time can buy ULIPs online
  9. Rating from a credible agency
  10. Tax benefits under Section 80C and 10(10D)
  11. Option to add protection through add-on rider options

These are the salient features of ULIPs in general.Not all ULIPs offer identical benefits. So, like the discerning foodie, look at the ULIPs on your plate carefully and select the ULIP that is best suited to your needs. For instance, select a ULIP that offers:

  1. Maximum number of options/plans
  2. Maximum premium allocation(low cost)
  3. Maximum number of free switches(with online options)
  4. Flexibility to invest online
  5. A consistent track record over bull & bear market phases
  6. Funds rating by credible agencies

One product, many life goals

ULIPs offer you the chance to achieve life goals like like child’s education and marriage, and retirement planning, among others.

All you need to do is study the ULIP landscape carefully, like the foodie studying his thali and select the best ULIP plan that suits your risk profile and needs.

Bajaj Allianz Future Gain, a unit-linked endowment plan, provides for maximum premium allocation to make sure your money is fully utilized towards your dream future.It has 2 portfolio investment strategies and 7 fund options, allowing for all the flexibility an individual needs in planning his finances.Several of the Company’s funds have been rated 5-star from Morning Star, an Independent Rating Agency.

References in the article to characters are only for representation purposes and we are not responsible for any misrepresentation/misuse of the same.Opinions in the article are made without mala fide intention.



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