I know 90% of the people who are reading my blog know all the info provided here, but un-fortunately we neglect/ignore in our busy life some important things.
At the age of 20 to around 35 people, especially men should be earning covetously, at the same time they should be saving materialistically. Because we never know how/what we are going to be in this dynamic world after 2 to 3 decades.
“Security” is the utmost important term we should be keeping in mind throughout our plan for future. There might be several things we need to plan which will fall under any of the below categories.
1. Children’s Education
2. Children’s Marriage
3. Want to buy a new house
4. Want to get Pension at your old age
5. Want to be safe for any medical emergencies
6. Want to keep your family stable in your absence bla bla bla & finally comes
7. Exemption from Tax in the current year
Investments should always be diversified You can paint this on your wall. Funnily, Ambani wouldn’t have become this richest if he has invested only in Petrol. TATAs, an omni-potential giant from India have invested in around 150+ different fields to become this giant. Conclusion is that “One should always think of diversifying their investment into different sectors”. While doing this we should keep in mind
1. Our investment should yield us maximum profit (Greedy, but we should be – includes maximum risk)
2. Our investment should at least be growing good even at market crisis time (Balanced and most of us fall under this sect - includes average risk)
3. Our investment should at least never throw us into losses(Safe – includes minimum risk)
Of the above three the first one requires much skill, much time to analyze the market conditions. Though this method yields max profits there will be huge risk involved. Third option mentioned above is the safest but yields minimum profits examples for this type of investments are NSS bonds. Coming to the 2nd option, this is the most common area where majority of the people are interested to invest.
As per my knowledge one should be investing in all the above 3 areas (as I have mentioned above, investments should be diversified - not only in different fields/sectors but also with different types of profit/security margins). But majority of our investment share should be falling on the 2nd bucket keeping a share on the remaining two. Just to give you a quick heads up, I have charted down an example.
Investment today Expected Amt 10 Years down the line
Aggressive X 10X (May or Maynot be - since this
includes maximum risk)
Balanced X 5X (Guarenteed)
Safe X 2.5X (Double guarenteed)
Now after going through all the above stuff, you would need to remember one more thing to distribute your investment in 1:3:1 for being balanced altogether.
Some thing like, you wanted to save a lakh this year it should be 20k in an aggressive area, 60k in a balanced area and 20k in a safe area as mentioned earlier.
Now comes where/how we will know which investment falls under which area listed above.
ULIPs/Mutual funds/Secondary market Investments – 1st Category – Aggressive & Risky
Life Insurance Policies – 2nd Category – Balanced
NSS (Postal) Bonds – 3rd Category – Safe
FYI: All the above 3 categorized investments can be claimed for tax exemption under different sections.
I want to now walk you through different aspects of Insurance policies, which comes under the 2nd (Balanced) category we were discussing so far.
The term Life Insurance is basically self explanatory, we insuring our life to back up several aspects. The prime areas this policies cover are
1. Saving
2. Risk coverage
3. Security
4. Bulk returns &
5. Tax Exemption
These days we see many companies (public/private listed) are into this field providing different schemes/plans etc… Now while going to choose a better in fact the best insurer that suits/fits our need we should consider the following aspects
1. Standard of the company
2. Credibility/Reliability of the company
3. Financial Backup of the company
4. Service offered by the company
5. Returns guaranteed by the company
6. Previous results(consistent between what if offers and what it provides)
7. Hidden aspects
8. Risks included/involved
Below info gives you the list of Insurers registered with IRDA so far(In total they are 23).
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
Profit and Loss list of All the Insurers
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About LIC...
• Founded in “1 September 1956”, having 54 years of experience with total assets around Rs 9.31 trillion (US$ 198.3 billion) – Covers points 1 &3 above
• LIC is serving over 250 million policy holders now in India – Covers points 2 &4 above
• The recent Economic Times Brand Equity Survey rated LIC as the No. 1 Service Brand of the Country – Covers point 4 above
• There are only 3% to 5% of the cases you find where the policy holder lost his money after investing in LIC – This case happens when the policy holder ignores/neglects his payments but even here is possibility of getting part of your investment back if you would have made payment for at least 3 years – Covers points 2 &5 above
• Competing with several different private organizations, LIC provides excellent service through different channels like ‘n’ no. of branches that offer direct service to the customers, supports fully online transactions (payment reminders, online payments, online status statements etc…)– Covers point 4 above
• Through out the years since the time of emerging LIC made sure that it is committed honestly in terms of claim and maturity payments. – Covers point 6 above
• There are not much hidden charges and no hidden aspects from public in case of LIC, unlike the some of the other private organizations. – Covers point 7 above
• Finally from (m)any of the past experiences no body can dare to say investing in LIC involves risk (unless for some of the ULIPs that LIC it self sponsor which comes under the 1st aggressive category we have discussed above) – Covers point 8 above
• All in All you will have all the above said 8 qualities in LIC of India in a positive direction/sense.
I hope you understand and felt a sense of saving while reading through my blog. I am an LIC agent, Chairman’s Club member serving around 1500+ clients till now through LIC. Please reach out to me for any further queries on the above.
Please feel free to drop me a mail/call me on my mobile any time you feel like.
Yours Sincerely,
SanthaMurthy Bhagavatula,
Mob: 9985502193
Email: subbaraobh@gmail.com
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