ULIP is the abbreviated form of Unit Linked Savings Plan. It is an exclusive investment scheme allowing dual benefits of insurance and financial market-linked investment tools. When you purchase a ULIP, a part of your investment gets invested in insurance, while the remainder gets invested towards debt, equity, or hybrid funds based on your choice, requirement, and risk appetite.
How does ULIP work?
When you invest in a particular ULIP fund, the concerned insurance company collects funds from all its customers and invests the amount in their chosen fund(s). Once the fund is invested in the market, it is divided into separate units with pre-defined face value. The invested fund is also divided into “units” for every individual investor.
The NAV, or the Net Asset Value of each unit, is the price of each unit at any given time. The NAV represents any alteration in the portfolio value.
In case you withdraw a partial amount from the designated cash reserve, following the plan terms, the corresponding number of units gets sold. Likewise, policy fees also get deducted in the form of unit numbers, as per the plan terms.
What is a ULIP calculator?
A ULIP calculator is a user-friendly, handy tool for making your investment calculations easy. As you open this digital tool and enter all the relevant details as required, you will see the tentative future of your planned investment(s), including the potential returns and benefits of several ULIPs.
You simply need to enter your desired return on investment, plan tenure, and risk appetite. This will reveal the potential future of multiple funds and how they will grow over a stipulated time.
With the aid of a ULIP calculator, you can even make a critical comparative analysis to make the right choice according to your target. This makes your investment journey and investment planning much easier.
What is the utility of the ULIP calculator?
Some of the best uses of the ULIP calculator include the following:
- Financial planning:
Strong financial preparation is the chief step to ensure a safe and secure future. A ULIP calculator provides insight into the plausible future and outcome of your ULIP investments. You can compare your goals and returns and then choose according to your requirements and risk appetite.
- Goal setting:
Well-planned, achievable goal setting is essential to ensure a concrete financial future. A ULIP calculator may act as a reliable aid in prioritising and establishing your investments to fulfil your targeted financial goals within a specified time. Essentially, it is ideal for long-term goals like marriage, higher education, post-retirement, etc.
- Comparative study:
ULIP calculators make investment evaluation easy for various kinds of ULIP investments. You can compare various plans, their exclusive features, potential returns, costs, etc. to make an informed investment decision, considering your targets and objectives.
- Risk assessment:
Risk comprehension and control are crucial to ensure financial security, especially in the long run. A ULIP calculator aids you in discovering the ideal risk and return combo depending on the investment portfolio by comparing varied ULIPs.
- Flexibility analysis:
Adaptability assessment is essential to handling unprecedented financial alterations. You can utilise the ULIP calculator to compare the varied features of different ULIPs, flexible fund alteration, premium payment amendments, and rider additions, ensuring that your investment remains flexible throughout meeting your altering financial needs.
- Investment monitoring:
Crucial analysis is essential for analysing and altering your funds’ performance to fulfil your financial targets. A ULIP calculator helps you evaluate and track your ULIP investment performances. This is critical to ensuring the flexible longevity of your planned investment strategy. You can make quick alterations if needed to suit your requirements.
How to calculate your ULIPs fund value?
Digital ULIP calculators are very user-friendly and quite easy to use. You need to follow these few simple steps to gain easy access and discover the answers to your question on “How to calculate your ULIPs fund value?”
- Go to the official website portal of your chosen insurance provider
- Enter basic details like your name, DOB, gender, contact details, etc.
- Enter correct information regarding pre-existing issues like smoking and drinking habits.
- Enter either the premium payable amount or your desired ULIP investment value.
- Choose the premium payment frequency- monthly, quarterly, half-yearly, yearly, etc.
- Enter your desired investment tenure.
- Choose your investment funds considering your choice and requirement: a combination of varied proportions of debt, equity, and fixed income.
- After cross-checking, click the “calculate” tab to discover the results
Features of ULIP calculator
Some of the significant features of the ULIP calculator include the following:
- Transparency:
The return calculation on the ULIP calculator is completely transparent. You can easily monitor every individual fund critically for pre-fixed tenures and make the necessary alterations based on the results.
- Targeted savings:
ULIP is an ideal wealth-building financial tool that works best in the long run. Using this calculator, you can choose the ideal fund(s) that will prove affordable and generate optimum returns within a stipulated time.
- Comprehensive control:
With the aid of a ULIP calculator, you can entirely control your ULIP investment portfolio. You can customise and tailor your investments according to your targets and risk appetite. This free digital tool allows you to alter the premium amounts easily, consider other fund options, and assess varied scenarios.
- Planning tool:
This unique assessment tool makes it easy to plan your investments. It essentially highlights all the relevant details required to fulfil your financial objectives based on your risk appetite.
Conclusion
From the above discussion, it is evident that the ULIP calculator is a handy digital tool essential to make informed investment decisions critically. It is very beneficial as it ensures transparent financial projection, plausible assessment of potential returns, and makes informed investment choices, plan customisation, risk evaluation, comparative analysis among various plans, etc. Make wise use of this tool and enjoy optimum returns.
