Investment plans

This query is : Resolved

Sunil Sandhyar (Querist)
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15 December 2014 Hello Dear,

kindly suggest me about investment plans i want to invest which give me better return from long term so kindly suggest me which one is best in market in below given:
Mutul Funds
ULIP

my annual income is 2 lac

hoping for better suggestion.

Rupesh Jain

Rupesh Jain (Expert)
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15 December 2014 in mutul fund you invest the money but releasable after some lock in period and amount the on the current market price.

ULIP Is alsop market related life insurance
in which you bear some charges it is deducted from your paid premium amount and after miniumum 5 year lock in period
you get money after deducting charges as per company policy.

if you take the market benefit directly then mutul fund and want to take life insurance cover also then take ULIP.

but your income is low then in my opnion you cannot bear the loss if market fell down. it s better to invest in kisan vikas patra or life insurance with money back,or PPF

Sunil Sandhyar

Sunil Sandhyar (Querist)
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15 December 2014 thanks rupesh for your good opinion, you suggest me KVP, PPF and Life insurance with money back, all these investments are one time investment or we can bear installment.

and about ULIP it is related with share market ?

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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01 August 2024 For long-term investments with potentially better returns, both Mutual Funds and ULIPs (Unit Linked Insurance Plans) are popular options, each with its own characteristics:

### **1. Mutual Funds**
- **Type:** Investment vehicle pooling money from multiple investors to invest in a diversified portfolio of assets such as stocks, bonds, or other securities.
- **Returns:** Generally higher potential returns compared to traditional savings options, but also comes with market risk. Equity mutual funds tend to offer higher returns over the long term compared to debt mutual funds.
- **Flexibility:** Can be invested in through lump sum payments or systematic investment plans (SIPs) where you invest a fixed amount monthly.
- **Liquidity:** More liquid compared to ULIPs. You can redeem your mutual fund units, although it might impact the returns depending on market conditions.

### **2. ULIPs (Unit Linked Insurance Plans)**
- **Type:** A combination of insurance and investment. Part of the premium goes towards insurance cover and the remaining part is invested in various funds such as equity, debt, or balanced funds.
- **Returns:** Potentially high returns based on the performance of the underlying investment funds. However, returns are subject to market risk as ULIPs invest in equity and/or debt markets.
- **Flexibility:** Premiums can be paid annually, semi-annually, or monthly. Some ULIPs offer partial withdrawals after a certain lock-in period.
- **Liquidity:** There is a lock-in period of 5 years, and surrendering before this period can lead to penalties.

### **Regarding Your Specific Queries:**

- **Investment Plans Suggested:**
- **KVP (Kisan Vikas Patra):** A government savings scheme with a fixed tenure. Returns are guaranteed and compounded.
- **PPF (Public Provident Fund):** A long-term savings scheme with tax benefits and guaranteed returns. Contributions can be made in installments.
- **Life Insurance with Money Back:** Provides insurance coverage and periodic payouts. Premiums are typically paid on an annual basis.

- **Installments:** All the mentioned investment options, including KVP and PPF, can be made in installments. For ULIPs, premiums can also be paid in installments (monthly, quarterly, etc.).

- **ULIP and Share Market:** Yes, ULIPs are linked to the share market because they invest in equity, debt, or balanced funds, which may include market-linked investments.

### **Conclusion:**
- **Mutual Funds** might be more suitable if you are looking for a diversified investment with potential high returns and liquidity.
- **ULIPs** offer both insurance and investment but come with a longer lock-in period and market risk.
- **KVP and PPF** are safer but generally offer lower returns compared to equity-linked options.

Given your annual income of 2 lakhs, you may want to consider a diversified approach by combining both safer investments like PPF with higher-risk, higher-return options like mutual funds, depending on your risk tolerance and investment goals.