Why Onam is the right time to buy an investment plan?

The significance of Onam

The festival of Onam has a deep cultural significance in Kerala. This festival celebrates the harvest season and expresses gratitude for nature's blessings. It's a time when families get together to make vibrant pookalams (floral designs), prepare a sadya (feast), and celebrate with the community.
An important tradition during Onam is welcoming new beginnings. To welcome prosperity into their lives, people often buy new clothes, invest in home improvements, or start new businesses. Onam inspires fresh beginnings in personal and cultural life, and this might be the best time to begin your disciplined saving and investing journey.

New beginnings & investment plans

By starting an investment plan during Onam, you can align cultural values with financial goals. The right plan can help you achieve long-term stability, whether you're funding your child's education, buying a dream home, or planning your retirement. You can consider the following investment options during Onam to enhance your financial journey with a new beginning.

• Gold Investment:In Onam traditions, gold has always played an important role. Gold investment during Onam is a reliable way to preserve wealth and provide financial stability.

• ULIPs: ULIPs offer an opportunity to invest in market-linked instruments, helping you build long-term wealth while potentially benefiting from market growth along with life cover.

• Term Plan: A term plan is a pure protection policy that secures your family’s future at an affordable cost. Investing in a term plan during Onam ensures peace of mind and protects the dreams of your family.

• Fixed Deposit: A fixed deposit is a low-risk investment that offers assured returns over a chosen period. For those seeking stable returns, fixed deposits are a safe and reliable investment option.

• Systematic Investment Plan (SIP):A systematic investment plan allows you to invest in mutual funds regularly in small amounts. It's a disciplined approach to building wealth over time and achieving long-term goals.

Why is Onam the perfect time to invest in a financial plan?  

Here are some reasons why Onam is a right time to buy an investment plan:
 

• Aligning with the festive spirit: Onam is associated with prosperity and wealth. The best time for investment in Onam provides an opportunity to reflect on long-term goals.

• Celebrating abundance: In the way Onam is a symbol of a good harvest, investing can result in financial security for the future. You can create wealth for important life goals by choosing the right Onam investment options.

• Auspicious timing: Wealth creation during festival is considered as an auspicious time of the year. Thus, Onam is also believed to be the right time for investment.

• Setting financial goals: Onam is a season of new beginnings. This is the perfect time to set new financial goals and begin the process of wealth creation, whether it's through Onam savings, systematic investments, or insurance-linked investment plans.

The benefits of starting early 

There are several long-term benefits to starting your investment journey early. You can buy an investment plan during Onam for these reasons:
 

• Power of compounding: Investing early gives your money more time to grow. In the compounding process, your earnings are reinvested, and this cycle multiplies your wealth over time.

• Long-term growth: Investing small sums regularly early can accumulate into a large amount over time. With this, you can save for your child's education, buy a home, or build a retirement fund.

• Reduced financial stress: The earlier you plan, the easier it will be to invest gradually. In this way, you won't face too much financial pressure during emergencies and can handle expenses without affecting your long-term savings.

• Disciplined wealth-building: By investing early, you establish a habit. You ensure steady financial progress when you make consistent contributions.

• Symbol of new beginnings: The festival of Onam is associated with prosperity and fresh starts. Investing during this festive season adds a cultural aspect to financial planning, marking the right time to make an investment.

Financial planning during Onam

Here’s how you can do financial planning during Onam:

Make smart savings

Simply saving your earnings is not enough. While it will help you save money, it won't allow you to grow your wealth. In contrast, if you park your money in a Savings Account, you can earn additional income. Opening a new Savings Account on this auspicious day will allow you to earn interest at a set rate. Additionally, a Savings Account allows you to use various other products and services.
 

Make smart spending decisions

Tracking your spending is the key to financial planning. Therefore, it is best if you track your spending habits. As a result, you will be able to determine where you can save by avoiding unnecessary expenses. This cash can be saved up or invested. By allocating funds appropriately, you will be able to limit unnecessary spending and increase your savings. Although the savings may not seem substantial at first, they can add up to make a considerable amount over time.
 

Consider investing

The best way to grow your Onam savings is to invest. Plan your financial goals for the short- and long-term. This will help you choose investment instruments that are right for you. For example, to diversify your portfolio and invest across asset classes, you can invest in mutual funds. If you want life insurance along with investment opportunities, you can consider Unit Linked Insurance Plan.
 

Take advantage of compounding

Make sure to take advantage of power of compounding when investing. Compounding refers to the process of reinvesting investment earnings. With each passing year, the principal amount and the interest earned increases. To take advantage of compounding, you can invest in instruments such as Fixed Deposits, Public Provident Funds (PPF), and others.
 

Tax savings

Tax reduction is another way to grow your wealth. Various legal provisions and instruments are available which can offer tax benefits leading to additional savings. For example, the Income Tax Act of 1961 allows you to deduct health insurance premiums and home loan repayments.
 

Seek professional advice

If you need financial advice, seek the help of a wealth manager or financial consultant. They can guide you on a financial plan suitable to your needs based on their expertise and experience. The advisor can recommend investment plans or instruments based on your investment goal and risk appetite.
To know more about Tata AIA Investment plans, visit our Investment plans section.

A Festive Opportunity for NRIs in India to Secure Their Financial Future

With the festive season, Onam is an opportune moment to secure a financial future by investing in long-term plans such as ULIPs, NPS, or mutual funds. NRIs, who focus on building wealth to secure their financial future of their loved ones, can take advantage of the various tax-saving opportunities and investment options available in India.
Whether it's contributing to building a retirement corpus, investing in market-linked instruments, or purchasing life insurance, Onam presents a perfect opportunity to make financially sound decisions and plan ahead for the years to come.

Tax planning during Onam

Onam is a right time to reduce taxable income. You can plan wisely before the financial year ends by investing in tax-saving investment plans, such as:

Unit Linked Insurance Plans (ULIPs)

ULIPs provide tax benefits under Section 80C of the Income Tax Act. ULIP premiums can be claimed up to ₹1.5 lakh as a deduction in a given year. Maturity and death benefit amount is tax-exempt under Section 10(10D), subject to certain conditions being satisfied.
 

Public Provident Fund (PPF)

PPFs are government-backed savings plans with a lock-in period of 15 years. Under Section 80C, contributions, interest earned, and maturity amount are all tax-free, which makes it one of the best tax-saving options in Onam.
 

Equity Linked Savings Scheme (ELSS)

The ELSS is a type of mutual fund that invests primarily in equities. Among Section 80C options, this one has the shortest lock-in period of just 3 years and can generate higher returns, but it comes with market risk as well.
 

National Pension System (NPS)

NPS helps you build a retirement fund and is a reliable long-term saving option, since in addition to the deduction of up to 1.5 lakh under Section 80C, you get an additional deduction of Rs. 50,000 under Section 80CCD(1B).
 

Conclusion

Onam celebration represents prosperity, gratitude, and new beginnings. The beginning of an investment plan during this auspicious time of year aligns with tradition and also contributes to safeguarding your future. Early and strategic investing can help you accumulate wealth, accomplish your objectives in life, and reduce financial stress. This Onam, take the first step towards your financial future.