ULIP Investments For Women and Single Mothers
If you are a woman or a single mother who wants to ensure your and your children’s future, you must invest your money in a way that offers security and growth. One option to look into is Unit Linked Insurance Plans (ULIPs).
ULIPs are insurance products that give you the dual advantages of investment and insurance. When you put money into a ULIP, a part of your premium goes towards offering life coverage and the remaining is vested in funds linked to the market, which you get to pick. This way, you can benefit from the market’s possible returns while ensuring that your family is protected in case of any unfortunate event.
ULIPs can be ideal for women and single mothers, as they can help you reach your financial goals and safeguard your family’s future. Here are three reasons why you might want to invest in ULIPs:
1. ULIPs can help you create wealth over time
ULIP investments help you save and grow your money by investing in market-linked funds with potential returns and growth. You can choose from different funds. You can also switch or redirect funds to optimise your portfolio.
For example, if you are young and aggressive, you can invest in equity funds for higher long-term returns. If you are cautious or risk-averse, you can invest in debt funds for stable and consistent returns. You can invest in balanced funds for growth and stability if you want both.
Investing in ULIPs can create wealth and help you attain your long-term goals, such as buying a house, funding your child’s education or planning your retirement.
2. ULIPs can provide financial protection for you and your children
When exploring what is ULIP, you must have gone through the benefit that they can provide financial protection for you and your children in case of unforeseen circumstances, such as death, disability or critical illness. ULIPs offer a life cover to ensure that your family receives a lump sum or a regular income in your absence. This can help them maintain their standard of living and fulfil their dreams without any financial burden.
ULIPs also offer various riders and benefits that can enhance the coverage and security of the policyholders and their beneficiaries. Some of the common riders and benefits are:
- Waiver of premium: This rider waives off the future premiums of the policy in case of death or disability of the policyholder, while keeping the policy active and the benefits intact.
- Accidental death benefit: This add-on offers an additional amount to the nominee in case of the death of the policyholder due to an accident.
- Income benefit: This rider provides a regular income to the nominee for a fixed period in case of the death of the policyholder.
- Critical illness benefit: This rider gives a one-time payment to the policyholder if they are diagnosed with a certain critical illness, such as cancer, heart attack or stroke.
3. ULIPs can offer tax benefits for you
Unit Linked Insurance Plans have another benefit of helping you save tax, as the premiums paid, the maturity amount and the death benefit are tax-free under Section 80C and Section 10(10D) of the Income Tax Act, 1961. That means you can reduce your tax liability on the amount you invest, the amount you get and the amount your family gets from the ULIP.
However, you should also know about the recent changes in the tax rules for ULIPs and how they impact the investors. As per the Union Budget 2021, ULIPs with an annual premium of more than Rs. 2.5 lakh will be considered as equity-oriented mutual funds for tax purposes. This means that the maturity amount and the death benefit of such ULIPs will be taxed as long-term capital gains at 10% if the gains are more than Rs. 1 lakh in a financial year. Therefore, assess your ULIP investment and pick the one that matches your tax slab and financial goals.
ULIPs are a smart way to achieve financial freedom for women and single mothers, as they offer investment and insurance benefits. ULIPs can help you create wealth over time, provide financial protection for you and your children and offer tax benefits for you. By investing in ULIPs, you can take control of your financial destiny and confidently start your investment journey.