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A Smart Investment Plan For Different Needs

A Smart Investment Plan For Different Needs

A Smart Investment Plan For Different Needs

At every life-stage, different financial goals take priority for every family, and so does different investment plans. If you want to invest in more than one financial goals at a time you need a smart investment plan.

A smart investment plan is an investment option which allows you to hit multiple targets with a single investment. You can also use different features of the smart plan to achieve different goals.

ULIP Investment Plan for Smart Investment

You can use ULIP plans for almost any financial goal which is at least five years away from now. These unit-linked plans have features and benefit options which can fit your needs at every age.

Some of the salient features of the modern ULIP investment plans are as follows:

  • Multiple asset options: Invest in equity, long-term debt, balanced and liquid funds
  • Long-Term Investment: Invest for periods ranging from 5 years to 30 years or up to the age of 100
  • Multiple risk management options for aggressive investors: Choose from the four portfolio management strategies to manage asset allocation and benefit from market opportunities
  • Bonus units for long-term investors: Bonus units added to your portfolio if you stay invested for more five and ten years.
  • Partial withdrawal facility: Meet multiple life goals with a single ULIP using partial withdrawal options
  • Systematic withdrawal option: Build a monthly income stream directly from your ULIP corpus
  • Leave a legacy for the next generation: Whole life ULIP plans can continue till you reach the age of 100. Thus, you can simply transfer the corpus to your children or grandchildren in the event of natural death.

Investments for Below 30 Years of Age

If you are under 30 years of age and have started earning. This is the best time to build the foundations for long-term prosperity. You have little responsibilities now but five to 10 years later you will have several short-term financial goals. Thus, you need:

Build an Emergency fund & Contingency Plan: This is to ensure that your savings are not affected due to a health emergency or accident. Also, the financial burden of your unfortunate demise of healthcare costs should not go to your parents.

  • Short-term deposits & funds: Park up to 6 months of your income into bank FDs, liquid funds, etc.
  • Buy health & life insurance: Health insurance like Mediclaim and critical cover will ensure that your savings remain unharmed during health emergencies. Life insurance will ensure that your parents don’t have to bear the financial burden arising from your sudden demise.

Short-term investments: Invest money for less than five years, steady growth. Use Debt mutual funds or bank deposits to accumulate this wealth.

  • Debt Funds: More tax-efficient and better returns for more than three-year horizon
  • Bank Deposits: Great liquidity, but low returns. Good for ultra-short-term investing, where you may need to withdraw money anytime.

Five Year+ Investments: Use long-term ULIPs to meet your five years + financial goals such as marriage, education, house purchase etc.

  • Start a ULIP till 60 years of age: This ULIP will help you meet your financial goals like, house purchase, vehicle upgrade, etc.
  • Start another ULIP for 100 years of age: This is your alternative retirement plan. Although you may start small, by the time you reach 60 this corpus will be large enough to provide you with the current level of salary every month. Invest at least 10% of your take-home income into this plan.
  • Wealth Goals: If after everything you can manage some surplus savings, start a wealth-building goal with ULIP plan’s auto portfolio management options.

Investing in Your 30s

The fourth decade of life, that is the 30s, is the decade with most changes to your life. You may get married, have children and start a new life of numerous responsibilities. This is also the age when your financial goals suddenly increase.

This is also the age when your investments must become serious to meet the new challenges:

Increase Emergency Fund & Insurance Cover: Your emergency fund and insurance covers should catchup to meet your spouse’s costs too.

  • An emergency fund needs to increase to account for the new income level. If both of you are earning, get the fund up to 6 months of combined income.
  • Life & Critical Health Cover: Your term life cover needs to include your spouse’s survival expenses and the cost of liabilities if any. You can also include your spouse under the same policy. Life Insurance like iSelect+ term plan allows both life and critical covers to working and homemaker spouse.
  • Health Insurance: Get a family floater Mediclaim cover. It will help you avail the maternity benefit and health cover for the child as well.

Invest for children with Goal Protection Option: With the addition of new life into your family, you need to start planning for her future.

  • Single Child Plan for Education & Marriage Goal: You can use a single ULIP plan to invest in your child’s higher education & marriage goals.
  • Use Goal Protection Option: Goal protection option in ULIPs can ensures that your child receives the intended maturity value, even after your untimely demise.

Start another 100-year ULIP for your & your spouse’s retirement: You will need to start another 100-year ULIP for your retirement income as your income grows significantly.

  • Keep up your retirement savings with the income growth
  • You will need a higher income than your present expenses due to inflation

Boost the Wealth Goal: Wealth goal investment will help you not only meet the unforeseen financial needs and goals but also help you fill the gaps in other goals. or simply starting a passive income before you retire.

Investing in Your 40s

During your 40s you can have a good surplus since most of your financial goals are either a few years behind you or after. So, you are free to invest or spend your surplus income any way you like.

However, this is also the best time to:

  • Review Your Contingency & Insurance Cover: Make sure they are keeping up with your family’s expenses and income.
  • Boost Your Wealth Goal: Invest the surplus savings into your wealth goal investment plan.
  • Review Your Goal Investment: Fill up any gaps you have in the savings towards your financial goals.
  • Boost retirement savings: Retirement is one goal where any deficit will probably remain a deficit and hurt in the final few years of life. So, better not take any chance and build a better corpus.

Investing in Your 50s

The 50s is that decade of life when you start powering down your investment growth engines and aim for stability. Here are the changes you should look forward to during this age:

  • Maintain the emergency fund as per new income and expense levels
  • Make sure your life and health insurance keep up with your needs
  • Prepare to pay off any loans you have, to avoid paying EMIs after 60
  • Changes to ULIP plans: If you have been using the ULIPs to meet your financial goals, make sure to:
  • Change Portfolio Strategy: Switch your portfolio from equity to debt funds using systematic transfer option. Most ULIPs offer safety switch option which moves your money to safety in the last four years of your ULIP plan automatically.

    Request for Systematic Transfer: For retirement ULIPs you will need to request for systematic transfer before the age of 60. The strategy option will not work in these plans as your maturity is expected to be at the age of 100.

Also, you may want to start exploring the pension options if you have invested in EPF or NPS for your retirement.

Invest 4G Unit Linked Life Insurance Savings Plan by Canara HSBC Oriental Bank of Commerce Life Insurance offers all this and much more. You can customize the plan as per your goals and changing requirements. With an unmatched combination of Portfolio Management Options and flexibilities, this plan gives you complete control over your savings and insurance needs.

Speak to an insurance specialist now!

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