Why and How to Invest Money

A quite nasty question for many of us while just started earning.   There will be multiple ideas behind every investment.

Saving the amount for future

Children Education

Children Marriage

For getting Pension

Exemption from Tax

Etc…

Everybody wants to have a good return on the amount they are investing while exempting from the Income tax. 

If you believe or not the main reason for this is “No body wants to loose money to in the form of Tax”.   According to our Government rules anybody earning money in our country should pay tax depending on his slab….

India Income tax slabs 2009-2010 for Men

0 to 1,60,000	No tax
1,60,001 to 3,00,000	10%
3,00,001 to 5,00,000	20%
Above 5,00,000	30%

India Income tax slabs 2009-2010 for women

0 to 1,90,000	No tax
1,90,001 to 3,00,000	10%
3,00,001 to 5,00,000	20%
Above 5,00,000	30%

Saving, Risk Coverage for Life and Tax exemption can be taken care with a single shot….. by taking an insurance policy which fits to our needs.

So here comes the question on how to invest now….

Your investment should do the following:

Tax exemption should be taken care

Good amount of return should be expected

Your future needs like, Medical, educational, and insurance expenditures should be taken care.  By investing wisely you may better your life standards and increase your future wealth.

In India to avoid your tax you can invest in many forms like, Taking Insurance Policy, Taking NSS certificates, putting money in mutual funds, etc…  

These investments should give you good returns.  You should be very wise in selecting the correct option.  Many will prefer Life insurance over NSS certificates because it covers the life risk and gives you good returns and not linked with the share market.

This is really is tough part where you need to forecast the future of the Insurer.  Here comes the question of selecting the proper insurer.

As of now there are 23 Insurers registered with IRDA.

Bajaj Allianz Life Insurance Company Limited
Birla Sun Life Insurance Co. Ltd

HDFC Standard Life Insurance Co. Ltd

ICICI Prudential Life Insurance Co. Ltd

IndiaFirst Life Insurance Company Ltd

ING Vysya Life Insurance Company Ltd.

Life Insurance Corporation of India

Max New York Life Insurance Co. Ltd

Met Life India Insurance Company Ltd.

Kotak Mahindra Old Mutual Life Insurance Limited

SBI Life Insurance Co. Ltd

Tata AIG Life Insurance Company Limited

Reliance Life Insurance Company Limited.

Aviva Life Insurance Company India Limited

Sahara India Life Insurance Co, Ltd.

Shriram Life Insurance Co, Ltd.

Bharti AXA Life Insurance Company Ltd.

Future Generali India Life Insurance Company Limited

IDBI Fortis Life Insurance Company Ltd.

Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.

Aegon Religare Life Insurance Company Limited

DLF Pramerica Life Insurance Company Limited

Star Union Dai-Ichi Life Insurance Company Limited

The below table shows why we need to prefer LIC over the other insurers.

About LIC...

Founded in “1 September 1956”, having 54 years of experience with total assets around Rs 9.31 trillion (US$ 198.3 billion),  LIC is serving over 250 million policy holders now in India.

The recent Economic Times Brand Equity Survey rated LIC as the No. 1 Service Brand of the Country.

When evaluating how to Choose an Insurance Company, it is convenient to make sure that the insurance company:

Is reliable

Has an excellent financial backup

Is consistent between what if offers and what it provides

Extends constant training and updating to its staff and agents

You will have all the above said qualities in LIC of India.