Investment-cum-insurance plans offer poor returns and insufficient life cover


By Yogita Khatri

Here’s a great investment idea. Invest Rs 25,000 a month for 20 years and get nearly Rs 64,000 a month from the 21st year on wards for 16 years. The income will also keep increasing by 6-7% every year. The investment is eligible for tax deduction under Section 80C. What’s more, the income received will be tax free and the buyer will also get insurance cover of almost Rs 80 lakh. Isn’t that a great way to retire in comfort?

That’s what Sachin Khairnar also thought when he signed up for the Retire and Enjoy combination plan of 16 Jeevan Anand policies in 2012. “It sounded attractive as I would get assured tax-free income as well as life cover,” says the Pune-based professional. Every year, thousands of buyers like Khairnar invest in traditional insurance plans, lured by the “triple benefits” of tax deduction on investment, life cover during policy term and tax-free income on maturity.

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