Life Insurance Vs Mutual Fund

When it comes to the best investment choices, everyone faces numerous choices. Moreover, where you plan to invest the money and how much is an individual’s choice. With a wide range of financial products at your disposal, the selection of a particular product can be a difficult task. What holds the most important part is your goals. You can be a single young investor or one with dependents to look after. Or perhaps some individual who aims to make investments to meet specific financial targets. You can take the help of the various Mutual Funds Calculator available online. Also, the goals differ from one person to the other. A number of times people tend to confuse in the basics of financial products like Life Insurance Vs Mutual Fund. Both of these are financial products that fulfill different financial needs.

Which is better?: Life Insurance vs Mutual Fund

Life Insurance Vs Mutual Fund

BasisMutual fundLife insurance
MeaningA mutual fund is an investment tool that helps you enhance your wealth through market-linked investments.Life insurance is a protection scheme that lets you secure the financial future of your family in your absence
Goal
  • Financial Goals

Mutual funds India are a rewarding investment to meet your long-term financial goals, be it for education, purchasing a property, starting a business, etc.

Dependents

A life insurance policy is a vital component of a person’s financial portfolio, as it safeguards the financial future of your dependents, your parents or children.

RisksA mutual fund does not guarantee returns &  does not provide any death benefit. A life insurance policy involves a lesser amount of risk as compared to mutual funds. There is a guaranteed death benefit.
Returns
  • Maximized Returns
  • Since the best mutual fund investment offers the option of diversification of funds, you can maximize your returns without being dependent on a single fund for growth.
  • Low Returns
  • If a life insurance plan is used for the purpose of investment, it is not only expensive but also does not promise returns similar to mutual funds.

And so, the importance of a life insurance policy cannot be overlooked. In addition, mutual funds are a rewarding investment to meet your long-term financial goals. And so, choosing the former over the latter is not a smart decision. Let us check which is better between Life Insurance Vs Mutual Fund.

Comparison between Life Insurance Vs Mutual Fund

 Life Insurance Vs Mutual Fund

If you are still feeling confuse choosing between a life insurance policy and a mutual fund. Don’t feel confused. In addition, each financial product holds a different advantage, it is important to understand each product in detail first. When it comes to any decision in relation to purchasing a financial product. It is very important to be aware of what each of them has to offer and how it would benefit you in the term period you need. And so, it is your hard-earned money that you remove from your income and park into a particular scheme.

Learn about:  Mutual Funds Benefits,

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ULIP(Unit Linked Insurance Plan)

In order to assist you better on this front, it is important for you to know about another product which is the ULIP plan. You can reap the advantage of both term life insurance and mutual funds by investing in a Unit Linked Insurance Plan. A ULIP gives a life insurance cover as well as a market-linked investment as per the same plan. The type of premium paid towards a ULIP  is utilized to give you a life cover while the rest of the corpus is invested in the markets to generate profits. ULIPs are a huge investment choice, as the policyholder can avail of dual benefits of life insurance and as well as investment returns from the equity/debt market. Although ULIPs invest your money in the equity and debt markets, they both carry comparatively lower risks as the funds are managed by experienced fund managers just like mutual funds.

Must Visit: Best Equity Mutual Funds

Best debt funds

For example:

Moreover, policyholders also have the option to choose ULIP funds according to their risk appetite and financial needs. For example, Aegon Life offers an investment plan which is a ULIP plan which offers a combination of investment as well as protection. This plan also gives flexibility which works well even for a first-time investor. It also encompasses tax benefits and you may start investing in the same with just Rs 2000 a month. You can choose from 6 unit-linked funds that are there in line with your investment goals.

Conclusion

The sound financial portfolio should incorporate both life insurance as well as market-linked investments. Equity market investments are an effective means to give a boost to your wealth in order to meet the necessary financial goals of life. Rather than going through the hassles of making two different premium payments to separate policies, buying a single ULIP will be a smart choice. If your goals align with what a life insurance plan and a mutual fund have to offer, this product would prove to be huge benefits for you. ULIPs also offer the flexibility to fix your returns as you pass through different stages of life. Chalk down your needs in detail and after conducting an analysis, make the smart choice and enjoy the best of both worlds. Life Insurance Vs Mutual Fund, these both are financial products that fulfill different financial needs.

To make the best profits on your money and want to know the Best Performing Mutual Funds India. As well As Don’t worry! Get in touch with the team of experts at Wealthbucket where our aim is to simplify compliances. Moreover, Let us guide you to reap the best benefits  Debt Mutual fundLarge Cap Mutual fund or Multi-Cap Mutual fund, to achieve your objectives.

For more details regarding the various compliances that your company may need to meet. Also, visit our website Wealthbucket. In addition, to resolve your problem just give a ring at +91 8750005655 . or shoot on our email at [email protected].

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By |2020-02-01T12:18:40+00:00June 21st, 2019|Insurance Distributor, Investment, Mutual Fund Distributor|0 Comments

About the Author:

This article has been posted by Pulkit Jain - the founder of WealthBucket - To raise awareness about Mutual Funds Investments. WealthBucket has made investing in Mutual Funds an easy, quick and welcome process, in India. An interactive online platform providing Trustworthy and sincere services to all its clients.