Markets have touched 10,000 and experts are divided on the direction the markets will take now. But you have to make those tax saving investments before March. So do ULIPs make sense?
The markets are scaling dizzy heights. And insurance agents are using this opportunity to push sales of equity-linked insurance policies. It’s an easy sell after all – the returns of the last year are bound to be attractive bait for prospective investors. But the darker side – ULIPs have long lock-in periods of at least 2-3 years. So if the markets take a dip after you have invested, you will have little opportunity to exit.
To find out if you should invest in equity ULIPs at these high levels. The answer is unanimous – expect returns from ULIPs only in the long-term, irrespective of market levels. For the short-term, stick to mutual funds. Given that ULIPs are good for the long-term, experts suggest tips to make the most of ULIP investments in this bull run.
Some key pointers:
- Stay invested for the long-term – 7 years minimum
- Invest systematically
- Don’t be tempted by a short-term Exit option
- Manage your funds according to your risk profile, not market movement
- Look at product features
We will discuss each of these points later in the coming posts.
