How ULIP Calculator Helps You Buy Your Preferred ULIP Plan

At times, when buying a Unit Linked Insurance Plan, people get confused about the premium amount to be paid, and the returns the policy will generate. Having a clear idea of these aspects of policy helps make an informed financial decision.

So, insurers in India offer a tool that helps you calculate the premiums and ULIP returns as well. The tool is known as a ULIP calculator. It helps you (the investors) calculate the maturity amount depending on the type of ULIP chosen.

The returns are determined based on the premium amount and the policy tenure chosen by you. In fact, many ULIP plan calculator tools also allow you to compare different plans based on the returns they generate and zero in a policy that is best suited for your needs.

How Does ULIP Calculator Work?

Before investing in ULIPs, you should understand the rate of return that you will receive after the investment. A ULIP plan calculator is the most effective tool in this subject. However, many people are not aware of how the tool works. To use it to your advantage, you need to know how the ULIP calculator functions.

Well, to calculate the returns generated on your ULIP investments, you need to enter a few personal details. The information includes your name, date of birth, whether you are a smoker or not, etc. Apart from this, other factors that you should keep in mind when using the tool are –

  • Premium payment frequency
  • Premium amount you plan to pay towards the ULIP
  • Types of fund you want to invest in
  • Rate of return
  • Policy tenure

Based on the information you have entered, the tool will calculate the amount you will receive in returns. It is important to note that the value calculated is a mathematical assumption. You should go through the policy terms and conditions carefully before buying the ULIP investment.

Benefits of Using a ULIP Calculator

A ULIP calculator allows you to make a secure and safe investment choice when buying ULIPs. The following are some ULIP calculator benefits that you should know –

  • The ULIP calculator tool is freely available on the internet. It allows you to compare and calculate the rate of return of different types of ULIP investments.
  • It is simple to use the tool and is usually available on your insurer’s website.
  • ULIP calculator performs complex mathematical calculations in a few seconds. It generates results quickly and helps you choose the right investment plan.
  • It helps you (the investors) choose ULIP investments strategically after evaluating different aspects.
  • It helps make investments easy for seasoned and new investors.
  •       The ULIP calculator has a user-friendly interface.

Why Should I Invest In ULIPs?

The reasons you should invest in ULIPs are as follows –

  • ULIPs offer dual benefits of life insurance cover and wealth creation all under a single policy.
  • You have the liberty to invest in ULIP funds of your choice – debt funds, equity funds, or a combination of the two.
  • You should make investments depending on your risk appetite. Those with a low-risk appetite should consider investing in debt funds. Others with a high-risk appetite can invest in equity-oriented funds.
  • In case you are not satisfied with the fund performance, ULIPs offer the facility to switch funds.
  • ULIP also offers tax benefits. The premiums paid toward the policy can be claimed for tax deductions under Section 80C of the Income Tax Act. Moreover, the death and maturity benefits of the policy are tax-free under Section 10(10D).

To Sum It Up!

ULIP investments are suitable for all types of investors. In fact, ULIP is a goal-based investment and can be purchased based on your financial objectives. You can purchase ULIPs for accomplishing long-term goals such as retirement, child’s education, child’s marriage, buying a new car/house, etc.

Make use of the ULIP calculator tool to compare different ULIPs available in the market and determine the rate of investment as well. All this helps you make an informed financial decision and secure your financial future.

Thomas Jung

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