5 Reasons You Need to Use the ULIP Calculator Online 

A Unit-linked Insurance Plan (ULIP) is a type of financial instrument that is a combination of investment and insurance to help you reach your long-term objectives while ensuring your family’s financial security in your absence. Due to the hybrid nature of the product, a portion of premium is used to pay for life insurance, and remaining sum is invested in the fund of your choice to grow your corpus.

But if you’re unsure how much to put up today to benefit later, you can make use of an online tool called the ULIP calculator.

The ULIP calculator tool has only been created to assist you in evaluating different ULIP plans and comprehending the maturity amount based on anticipated future investment value and returns; thereby allowing you to achieve your life goals in the future.

How Does the ULIP Calculator Work?

The ULIP calculator is a simple-to-use tool that estimates the return you might get on maturity. Enter the premium amount, the frequency of payment, the type of fund, the return percentage, and the tenure of the investment.

Some ULIP calculators provide users with the choice to invest in the best investment plan in India and divide the total investment amount between risk-free and market-linked investments. Investors should use the ULIP calculator tool to determine the expected return rather than the precise amount. This is because the amount determined is a provisional figure due to the changing the nature of some parameters.

4 Reasons you Should Use an ULIP Calculator

ULIPs calculator are exceptional and regret-free for tax-saving decisions for the following reasons:

1. Significant Customizability 

ULIPs allow for high levels of customization even after you begin investing in one of the

best investment plans. Even though ULIPs offer various asset allocation options, you always have control over your portfolio. Change your fund allocation to reduce risk if you think you have chosen risky investment assets. Since ULIPs perform significantly better over lengthy periods, you should only allocate your investments to long-term goals.

The ULIP calculator can help alter the portfolio strategy and fund allocation and move money to a different fund option as needed. You can experiment, enter different figures to see if you are getting returns as per your plans. If not, you can make a wise decision accordingly.

2. Improves Life Coverage

Since ULIPs offer the benefit of life insurance policies as well, they are always accompanied by a life cover. As a result, whenever you invest in a ULIP, you also ensure the financial stability of your family in case you are gone.

An ULIP calculator helps you find the right life coverage. For instance, you can make sure if the life cover is adequate to meet your child’s financial needs when you are not around. If not, you can go for a higher cover and check if the premium that comes with it is affordable or not.

3. Free of Tax Returns

You can invest any amount in ULIP plans, but tax savings are only allowed up to the 80C

restrictions. The maturity value you receive may still be entirely tax-free even if your annual ULIP deposits go beyond the 80C restrictions. You must invest up to 10% of the policy sum insured in any policy year to ensure that your maturity proceeds are tax-free.

4. Future Investment Amount Modification

You can modify your initial ULIP investment amount later using the 10% rule of taxation. Even if you don’t have a long-term objective, you should leave the option of investing a higher amount in the ULIP plan open.

If you start investing early, growth is very likely for you. Keep your sum assured high to avoid purchasing a new ULIP plan when your financial capabilities increase.

For instance, if you can deposit Rs. 1 lakh per year in ULIP investments, you can choose an Rs.15 lakh sum assured. As a result, if you decide to increase your annual investment in the future, your ULIP investment will remain tax-free.

Final Thoughts:

ULIP is the one of the best investment plans in India. They should be selected according to premium, return, flexibility and tenure. A ULIP calculator is simple to use and is offered without charge. Based on your age, financial objectives, and risk tolerance, you can buy one of the best investment plans.

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