A ULIP calculator is an online tool that helps in calculating potential returns, costs, and maturity value of a unit-linked insurance plan. The main objective of a ULIP calculator is to simplify financial planning by providing clarity on how premiums, policy terms, and market-linked* returns work together. This article explains the ULIP calculator’s features and benefits.
What is a ULIP calculator?
ULIP calculator is an online tool that helps you calculate your potential returns from a unit-linked insurance plan. In the calculator, you need to input details like premium amount, policy term, payment frequency, and expected rate of return. The calculator provides instant results on how your investment may grow over time while accounting for both the insurance and market-linked components of a ULIP. It offers an estimate of the maturity value, helping investors understand the financial outcome of their plan before committing to it.
How to use a ULIP calculator?
The calculator shall ask you for some factual details. These include your date of birth, gender and smoking habits.
Thereafter, punch in the details about the planned ULIP investment. Mention the amount of premium you are willing to pay. Keep in mind your current financial income and obligations while mentioning this amount. You also need to choose the periodicity of investment, i.e. monthly, quarterly, bi-annually or annually. Next, select the tenure of the period for which you would like to stay invested. Your financial objectives influence these inputs.
Finally, opt for the fund type for investment. You may choose the investment option in line with your preferences.
As an output, the calculator returns the anticipated future value of your investments.
Hence, on evaluating the quantified results, you can invest in the ULIP plan of your choice.
Why use a ULIP calculator?
ULIP plan calculator is an online application that allows you to estimate the returns that you are likely to get on a unit-linked insurance policy. You should enter information such as the premium amount, policy term, the frequency of payment and the expected rate of returns in the calculator. The calculator gives you immediate feedback on how your investment could multiply over the years and takes into consideration the insurance and market-related aspects of a ULIP. It provides a rough estimate of the value upon maturity, which enables the investors to know the financial success of their plan before they commit to it.
What are the key features of a ULIP calculator?
The following are the key features of ULIP calculator.
Transparent
A ULIP calculator shows how your returns may change with market performance, giving you a clear and transparent view of your expected gains.
Flexible
The ULIP calculator provides flexibility. As it helps you adjust inputs like premium, policy term, and expected returns instantly, helping you see how different choices can impact your maturity value.
Supports better decisions
The calculator allows easy comparison of options and selection of the best ULIP investment plan that suits your financial objectives by showing results of various options.
What are the benefits of a ULIP calculator?
Below are the key benefits of ULIP calculators.
Simplifies financial planning
A ULIP calculator simplifies financial planning, as you can easily estimate your potential returns. It also helps investors choose the right premium amount and policy term to meet long-term objectives.
Helps make informed investment decisions
By showing how returns may vary based on fund type and risk level, the calculator helps you decide whether a ULIP suits your financial goals and risk appetite.
Enables comparison of various ULIPs
ULIPs vary in terms of fund options, features, and charges; therefore, the calculator can be used to compare the potential outcomes. This simplifies the process of selecting a plan that provides greater value at an optimal price.
Helps in adjusting the investment plan
You can easily adjust variables such as premium, tenure, and returns expected at any given time using a ULIP calculator. This flexibility helps you revise your investment strategy as your income or financial goal changes.
Improves understanding of ULIPs
Using the calculator shows how factors such as premium, policy duration, fund choice, and charges affect your returns. This builds a clearer understanding of how ULIPs function. It may also help you estimate the partial withdrawal amount you can receive from a plan.
Shows how charges affect returns
ULIPs come with several charges. The calculator highlights how these costs influence your maturity amount, helping you choose a plan that balances expenses and potential growth.
Displays future growth
A ULIP calculator displays how your investment may grow over the years, encouraging disciplined and long-term investing.
How does a ULIP plan work?
A ULIP plan works by dividing your premium into two parts: one for the insurance coverage, and the other one is invested in market-linked funds such as equity, debt, or balanced options. Based on the market performance, the value of the fund increases or decreases, making changes in the overall investment value. Investing in ULIP flexibility to switch between funds depending on risk tolerance and market conditions. At the time of maturity, you receive accumulated funds while your family remains protected through the insurance cover during the entire period.
What is the death claim payable in case of ULIP?
A death claim normally comprises the sum assured or the fund value. Your family receives the death benefits on the demise. Hence, a ULIP policy extends financial support during unfortunate times. Besides, the death proceeds are tax-free1 under Section 10 (10D).
ULIP Products with Tata AIA
Every assessment year you are required to file for your tax returns by July 31. However, the earlier you start your income tax filing process, the sooner you can get the excess tax money reversal.
What is the TDS refund process?
We, at Tata AIA, understand the importance of ensuring your life and generating wealth. So, we offer a range of ULIP products that help you get the dual benefit of insurance and wealth creation. Each plan is unique to suit your custom requirements. You may seek the professional advice of a Tata AIA consultant to choose the best-suited plan.
Conclusion
A ULIP calculator helps investors in proper planning by giving a rough estimate of likely returns, fees, and long-term growth. It simplifies comparisons, supports better decisions, and ensures the chosen ULIP works in line with their financial objectives. By understanding the expected outcomes, individuals can select a strategy that offers both protection and wealth generation.
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