Hi All,
Just want to clarify myself in one situation regarding my LIC policy surrender and investing that amount in another scheme(PPF/Fixed deposit). May be I made some assumptions which am not anware. Please correct me if I am wrong.
I am holding LIC Jeevan Anand. and planning to surrender.
However as of now total amount of installments is 1.25L(5 years) with yearly premium of 25K. Sum Assured is 5L. Remaining period is 15 years. Earned Bonus is 1.1L
So with these calculations, lets say if I continue with Jeevan Anand and bonus is being paid in the same rate ie around 1 L for every 5 years of premiums(1.25 L), then at maturity
I will be total total amount of 9 L(5L premium+ 4L bonus).
If I surrender the policy now, I will be getting the amount equal to 75K, which I was told will be getting around 2-3 L if I invest in PPF.
Now if I invest that premium of 25K every year in PPF, I found I will be getting around 7L after maturity.
So with these calculations, since I am already into 1/4 period of LIC total terms, is it ok to continue with those premiums and get the bonus to play it with safe side and not loose earned bonus.
May be this might not apply to everyone. Also I am not aware about withdrawal issues of PPF. And I know we cannot take the money back from LIC untill maturity if we are expecting complete bonus payout. I also heard that LIC Jeevan Anand is best endowment policy available. So may be after all that expectation of 1 L bonus for every five year is not too optimistic I suppose.
Please help if I am missing any link here. And of course keeping that money in MF or in FD might even fetch more returns. As I mentioned just played it safe in this aspect and plan other investments properly from now.