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POSTED BY ON March 19, 2013 1:09 pm COMMENTS (8)
Hi,
I have read some articles on this forum and i am really impressed on the suggestions given by all. You people are doing a great job by educating new investor about the pros & cons on every investment.
I also need some valuable suggestion on this plan. I am planning to go for ing vysya New Fulfillng life, but before buying i wanted some advice.
my age is 29 yrs.
This policy has different premium paying term :16, 20, 24 yrs
I will be opting for 20 yrs. I m interested in this policy because, some amount is paid back during the premium paying term periodically and it have life cover & tax benefit. Below are the details
premium amt: Rs.2386
policy term:20yrs
after 5yrs : i will receive Rs.70,000 (20% of sum assured)
after 10yrs : i will receive Rs.70,000 (20% of sum assured)
after 15yrs : i will receive Rs.70,000 (20% of sum assured)
after 20yrs : i will receive Rs.1,40,000 (40% of sum assured)
on maturity(i.e after 85 yrs of age): i will receive sum assured + bonus
Also the premium paying term will be of 20yrs, but the life cover will be there till 85 yrs.
I have already invested in some mutual funds, but due to the risk factor, i dont want to invest more in MF. Also this plan has life cover & tax benefit compared to mutual funds.
I dont want to go for term plan as it has no maturity benefits. Also, I already have a term plan attached with my home loan.
Please let me know your views on this plan.
Thanks,
Sachin
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Dear Ashish, thanks for helping us. Let dear Sachin decide his future course of action.
Thanks
Ashal
Yeah Ashal, I really feel sorry for people, who want others to help, make conditions for their help and above that don’t actually take their help.
Wish I could have got the guidance 9 years back and had invested wisely then.
Hi Sachin,
At one point you are saying “You people are doing a great job by educating new investor about the pros & cons on every investment.” and even after this you are saying you want to put your money in insurance as investment.
The most important thing that I have learned from here is Investment and Life Insurance are two different things and not to be mixed up, which you are doing here.
I have done this mistake because I was not exposed to jagoinvestor.com in 2004. Now that you have this forum and people sharing there experiences, you still want to commit the mistake. This is surprising!!!.
People say “Learn from your mistakes” and sometime back I read somewhere – “Learn from others mistake, because you may not have enough time in life to commit all of them.”
Here you will be paying Rs.28,632 a year for a cover of Rs.3.5 Lakhs and getting it in parts over 20 years. Also at the age of 85 (51 years from now) you will get Rs.3.5 Lakhs + bonus.
Consider a scenario, where you a buy a term plan for about 1 crore at Rs.8500-9000 and invest 20,000 every year in other instruments say ELSS for 20 years and then leave it till you achieve 85 years, you will surely get better returns than the said policy + the lock in period in ELSS is 3 years so if need be, you can redeem few units every 5th years (similar to what your policy would be paying you in parts)
Or put the money in PPF for 15 years and extend for another 5 years to make it earn interest for 20 years and after that decide how to use the amount to make it grow further.
P.S: Your term plan associated with home loan would end the day you finish your loan, what would you do after that? Will you buy a term plan at that point in time and pay higher premium for the same amount that you can afford easily today? Think about it.
I am not a financial consultant but a person just like you, who is trying to learn from this website and from others mistakes.
Happy thinking and deciding!!!
Regards,
Thanks Ashish for the detailed scenario you have given. After reading this, I will definitely not fall a prey for these type of plans.
Probably, I’ll have to look out for a good term plan and invest the remaining amount in PPF.
Good to hear Sachin. And also good term plan does not simply mean lesser premium, please also check the other features (riders available etc) of the policy offered by various insurers. Aviva and Bharti are much cheaper whereas ICICI and HDFC are a little costlier as compared to Aviva / Bharti may be because HDFC / ICICI looks more credible on paper.
Regards,
Dear Sachin, please go ahead & purchase this one of the best plan on offer. Best for the issuer (Insurance co, agent, staff). We are not going to teach anything to you as you have already understood all the work by us. Term plan is sheer waste of money.
Just tell me one thing – 3.5L Rs. sum assured in this plan ‘ll be enough for your family if you die today? This 3.5L Rs. ‘ll take care of your family’s living expenses for next 25-30 years. “ll take care of education expenses of your kids, career expenses of your kids, medical & other things…….. So yes, this 3.5L Rs. sum assured money back policy is the best for you. 🙂
Thanks
Ashal
If you have read many articles on this forum it is very disappointing to see you state
“I dont want to go for term plan as it has no maturity benefits”
You would also have understood not to enter a complicated product such as the one you have described.
Please purchase Manish’s book (link in the bottom left) and read. Good luck.
FFC,
even the book will not be helpful for such people.
There will always be lazy people out there, who will not apply their minds. You cannot help them.
See this too: http://alephblog.com/2013/03/13/should-brokers-be-fiduciaries/