How to Create ₹3 Crore in 10 Years with a ULIP?

Written by : Knowledge Center Team

2025-10-11

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Building a corpus of ₹3 Crores may seem challenging, but with the right plan, you can achieve it. The amount you need to invest each month depends on the number of years you have to invest: 10, 20, or 30. Starting early, investing consistently, and using the power of compounding can make a big difference.

Ideally, ₹1.6 lakh a month is what it takes to build a corpus of ₹3 Crores in 10 years or so. And how is that possible? With a conservative rate of return of 8% p.a. However, this estimate does not account for the taxes on the interest or maturity value. Therefore, the income from this investment must be completely tax-free.

Now you may wonder if there is a wealth creation plan that allows you to accumulate crores within a few years, tax-free? Fortunately, there is – Unit Linked Insurance Plans or ULIP investment plans that can make this feat possible for you.

In this blog, we explain how much you need to save each month to reach ₹3 Crores and how your timeline shapes your financial journey.

Is there such a wealth creation plan, which lets you accumulate crores within a few years, that too tax-free? Fortunately, there is – Unit Linked Insurance Plans or ULIP investment plans can make this feat possible for you.

Key Takeaways

Start investing early to reduce the monthly amount required to achieve your goal.
ULIPs help you grow wealth while offering life insurance protection.
Compounding builds momentum over time, rewarding consistent early investments.
Assuming moderate returns keeps your financial plan grounded and achievable.
Automating your investments builds discipline and helps avoid missed contributions.

What is a ULIP Plan?

ULIPs are life insurance plans with a fruitful investment structure that help you build wealth with confidence. It enables you to invest in a combination of equity and debt funds within the same plan. You can also use dynamic investment strategies to minimise your portfolio's risk and take advantage of market opportunities.

Turn Small Investments Into Big Wealth with ULIP

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What are the Benefits of a ULIP Plan?

Unit-linked insurance plans bring together life cover and investment in one powerful package. They offer a flexible and efficient way to build long-term wealth.

Let's explore their top advantages in a simple and engaging way.

Long-term financial growth: ULIPs are ideal for individuals who wish to remain invested for several years. Long investment durations help you ride out short-term market fluctuations and grow your wealth steadily. This approach works especially well for long-term goals, such as retirement or your child’s education.
Tax Benefits at Every stage: It offers tax deductions on the premiums you pay under Section 80C. You also enjoy tax-free maturity benefits under Section 10(10D), subject to conditions. Even the top-up amounts you add during your policy term qualify for tax benefits.
Investment Flexibility: You can switch between equity and debt funds based on your risk appetite and market conditions. You also have the freedom to redirect future premiums to a different fund without touching your existing investment.
Access to Partial Withdrawals: Once the lock-in period ends, you can withdraw a portion of your investment to meet urgent needs, such as a medical emergency or a family expense. These withdrawals are tax-free.
Focused savings for life goals: It also promotes disciplined investing. You can align the policy to major life goals such as buying a home or funding higher education. Regular contributions over time help you build a solid corpus while staying committed to your goal.
Life cover for financial security: While your money grows, you also stay protected. In the event of your unfortunate demise, your nominee will receive the higher of the sum assured or the amount of the policy.

How to Invest in ULIP to Build a Corpus?

Contrary to the popular belief, investing in ULIP is not a difficult task. The simplest way to achieve this goal would be to assume a minimum rate of return on a 10-year investment (approx. 8% p.a.) and start saving (₹ 1.6 lakhs a month).

Keeping ULIP Investment Plan Tax-Free

The maturity value from the ULIP investment will stay tax-free so far as your annual investment amount stays below 10% of the life cover. So, to invest ₹ 1.6 Lakhs a month you will need to apply for a life cover of approx. ₹ 2 crores.

Also, if you plan to increase your investment in the coming years, you can keep your life cover slightly more than 10 times of your annual investment. After all, that’s the minimum you can choose for the security of your loved ones.

Can You Invest Lesser Amount?

Of course, you can. You need to invest ₹ 1.6 lakh only because you want to achieve the ₹ 3 Crore goal in 10 years. If you increase the tenure, here’s how your monthly investment will drop:

Investment Tenure (years)	Monthly Investment Needed
10	164,000
15	87,000
20	51,000
25	32,000
30	20,000

You may notice that with just a 5-year increase in your investment tenure, your monthly investment needs drop by 50%. What you see in this table is the power of compounding taking effect.

You can also see that anyone starting at the age of 25 can start investing just ₹ 20,000 a month and achieve this goal.

Can You Improve the Return on Investment?

There’s a popular saying among planners of all disciplines, ‘plan for the worst and hope for the best.’ This is especially applicable to things which are not in your control, such as the rate of return on investment.

Increasing your rate of return assumption will reduce your monthly investment need on paper. However, in reality, it may backfire, as your earliest investment may drop and fail to add enough value in the later years of the investment. Worse, if the actual returns remain below your expectations, you will need to invest higher amounts later to achieve the goal in time.

Example: Let us say your goal is to build a corpus of ₹3 Crores in 20 years.

If you assume an 8% annual return, you will need to invest approximately ₹35,000 per month.
But if you increase your return to 12%, your monthly investment on paper reduces to ₹22,000.

This may look like a smarter choice at first, but it can be risky. If your actual return remains closer to 8% instead of 12%, you will fall short of your ₹3 crore corpus goal. You will need to invest a higher amount later to compensate for the gap.

How to Use the Power of Compounding?

You want to invest more in the early years so that a greater portion of your savings benefits from the power of compounding. You can see a simple example in the table above; as you compound more, your regular investments reduce exponentially.

You can also reverse the example to view it from a different perspective. Suppose you are 30 years old right now and start investing ₹20,000 a month in a ULIP plan. Whereas your friend will start at the age of 50.

By the time your friend starts investing, you will be sitting comfortably at approximately the same time. ₹. 1.2 Crores. Not to forget the fact that you will still invest ₹ 20,000 towards this goal, while your friend will need to invest a whopping ₹ 1.63 lakhs per month.

What are the Principles for Achieving Large Financial Goals?

There's nothing wrong with investing huge sums of money towards a single goal. However, for the most part, the example may seem quite impractical, as you are more likely to have multiple goals at the same time.

So, whatever financial goal you wish to achieve, always stick to the few principles of wealth creation plans:

Start early, even with a small amount
Avoid assuming huge returns on investment
Focus on managing risk on your investment. More people lose money due to panic selling than actual market events.
Invest regularly and as much as possible in a consistent rhythm, for example, ₹ 5000 every month.

Conclusion

Unless investment management is your full-time role, automate as much of the transaction process as possible; i.e., use auto-debit for investments, automated portfolio management for asset allocation changes, and account transfers for maturity value. With these principles, you can be sure to achieve any financial goal you set your sights on to the best of your ability. May the power of compounding be with you.

Ready to build wealth with confidence? Start your ULIP plan by Canara HSBC Life Insurance today and let the power of compounding work in your favour.

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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