ULIP with credit card better than Mutual fund?

[shashwatchadha]

Lot of debate is going on between ULIP vs MF.
But we have new age ULIPs like Hdfc life C2W, with very less charges. And no taxes till 2.5lakh premium.
What is your take on this? Using CC like SBI cash back, we can easily get 5% cashback when paid using Amazon GV.
Infinia can get around 13%

 

[Vasuki]

Lot of debate is going on between ULIP vs MF.
But we have new age ULIPs like Hdfc life C2W, with very less charges. And no taxes till 2.5lakh premium.
What is your take on this? Using CC like SBI cash back, we can easily get 5% cashback when paid using Amazon GV.
Infinia can get around 13%

Depends on person to person

One layman knows nothing of finance just want to save money
Ulip is cool

Someone who knows little invest
In sufficient amount of fd then gold
Then market
For 2nd guy ulip is Black hole

 

[SSV]

Lot of debate is going on between ULIP vs MF.
But we have new age ULIPs like Hdfc life C2W, with very less charges. And no taxes till 2.5lakh premium.
What is your take on this? Using CC like SBI cash back, we can easily get 5% cashback when paid using Amazon GV.
Infinia can get around 13%

First and foremost thing, from what I hear and read, there is no more Infinia approval based on ULIP..please correct me if I am wrong..

 

[shashwatchadha]

First and foremost thing, from what I hear and read, there is no more Infinia approval based ULIP..please correct me if I am wrong..

This is correct

 

[V360]

First and foremost thing, from what I hear and read, there is no more Infinia approval based ULIP..please correct me if I am wrong..

Its still on for few cases.

 

[shashwatchadha]

Depends on person to person

One layman knows nothing of finance just want to save money
Ulip is cool

Someone who knows little invest
In sufficient amount of fd then gold
Then market
For 2nd guy ulip is Black hole

why is it a black hole?

 

[fradela]

Investment, Insurance and Credit Card all are different entities.

Don't couple them.

Decouple them is the best way.

Insurance: Take only Term Insurance and Health Insurance.

 

[shashwatchadha]

Investment, Insurance and Credit Card all are different entities.

Don't couple them.

Decouple them is the best way.

Insurance: Take only Term Insurance and Health Insurance.

Can you elaborate with an example?

 

[harshgupta940]

Lot of debate is going on between ULIP vs MF.
But we have new age ULIPs like Hdfc life C2W, with very less charges. And no taxes till 2.5lakh premium.
What is your take on this? Using CC like SBI cash back, we can easily get 5% cashback when paid using Amazon GV.
Infinia can get around 13%

Not sure if you are talking about the same policy. But according to HDFC Life's Click 2 wealth's proposal and according to Invest Plus plan's Illustration the XIRR is 7.41% (lesser than they claim). So in no way its better than MFs.

I didn't subtract the value of premium you would pay for 5lk Insurance as 5lk is a very less cover and a person would have to eventually take another term life insurance.

 

[shashwatchadha]

Not sure if you are talking about the same policy. But according to HDFC Life's Click 2 wealth's proposal and according to Invest Plus plan's Illustration the XIRR is 7.41% (lesser than they claim). So in no way its better than MFs.

I didn't subtract the value of premium you would pay for 5lk Insurance as 5lk is a very less cover and a person would have to eventually take another term life insurance.
View attachment 81460

"In insurance, you typically see "4%" and "8%" displayed in benefit illustrations because insurance regulators like the IRDAI (Insurance Regulatory and Development Authority of India) mandate that companies present potential returns based on two assumed interest rates: a conservative 4% and a more optimistic 8%, allowing customers to compare potential outcomes under different market scenarios."
So, this 8% is just an illustration.
ULIP, invests in funds, example - HDFC Life Discovery Fund(Annualised return of 26% in last 5 years ). Most of these funds beat the benchmark consistently.

 

[harshgupta940]

"In insurance, you typically see "4%" and "8%" displayed in benefit illustrations because insurance regulators like the IRDAI (Insurance Regulatory and Development Authority of India) mandate that companies present potential returns based on two assumed interest rates: a conservative 4% and a more optimistic 8%, allowing customers to compare potential outcomes under different market scenarios."
So, this 8% is just an illustration.
ULIP, invests in funds, example - HDFC Life Discovery Fund(Annualised return of 26% in last 5 years ). Most of these funds beat the benchmark consistently.

The point is even for 8% its less than 8%. Even after including the cashback into the calculation.

Also lack of liquidity for 20 years while ELSS gives tax free with 3 years lock in.

 

[shashwatchadha]

The point is even for 8% its less than 8%. Even after including the cashback into the calculation.

Also lack of liquidity for 20 years while ELSS gives tax free with 3 years lock in.

I guess as the policy term is 20 years, maturity will be in 2044 in your calculation.
ULIPs can be fully withdrawn after 5 years, without any deduction and taxation .

 

[harshgupta940]

I guess as the policy term is 20 years, maturity will be in 2044 in your calculation.
ULIPs can be fully withdrawn after 5 years, without any deduction and taxation .

20 years are going to get completed in 2045 only as if its 2044 then when you pay the last premium it will mature but that's not the case in any plan. You pay the premium in 2044 for 20th year and at the end of policy which is 2045 you get your Money.

 

[shashwatchadha]

20 years are going to get completed in 2045 only as if its 2044 then when you pay the last premium it will mature but that's not the case in any plan. You pay the premium in 2044 for 20th year and at the end of policy which is 2045 you get your Money.

Hmm. yes . thanks this was insightful.

 

[ashwinikumar900]

Lot of debate is going on between ULIP vs MF.
But we have new age ULIPs like Hdfc life C2W, with very less charges. And no taxes till 2.5lakh premium.
What is your take on this? Using CC like SBI cash back, we can easily get 5% cashback when paid using Amazon GV.
Infinia can get around 13%

I am only going to talk about ULIP vs MF. Some key points to consider in my option.
1. See, ULIPs may have reduced their charges but still there are plethora of charges which is more than the Expense ratios of MFs (FOR ACTIVE FUNDS).
2. There are many bigger and proven track record Fund managers in MFs which lacks in ULIPs. Hence MFs results in BETTER PERFORMANCE than ULIPs.
3. ULIPs are not that transparent than MFs, because of its duel nature of both INVESTMENT and INSURANCE.
4. You gets lots of choices in MFs both in active and passive fund category.
5. there are no fund locking period (except ELSS), and no hassle in redeeming funds too in MFs.
6. I think, at the time of maturity ULIPs automatically transfer funds to savings regardless of market conditions, so this may be an issue. Recheck this point.
and, there are many other points too. But lastly it depends upon you. But in my opinion one should keep investment and insurance options separate.

 

[dryvnr]

AFAIK MFs are better than ULIPs in all scenarios

 

[dvader]

1: There is no debate between ULIP and MF
2: Never plan your investment thinking about cashbacks. Never.
3: Keep your insurance and investement seperate.
4: Do not try to score a financial product with ULIP, MF or any other investment. If you have a lot of disposable income sure but again if you had you wouldn't need that product in the first place. or if you were planning to make that investment in the first place, then no harm in negotiating some goodies.
5. Money in your bank never did you any harm. Think twice before spending it.
6. When in doubt, go open an FD in your mom's (or other family member) name. Save tax, safe returns and you get to be a good son. FD gives you the right to get a credit card too.

All this applies if you a middle class Indian. Bhtt paisa h to to tension ni lene ka, manager ghat ake deke jayega infinia.

 

[shashwatchadha]

1: There is no debate between ULIP and MF
2: Never plan your investment thinking about cashbacks. Never.
3: Keep your insurance and investement seperate.
4: Do not try to score a financial product with ULIP, MF or any other investment. If you have a lot of disposable income sure but again if you had you wouldn't need that product in the first place. or if you were planning to make that investment in the first place, then no harm in negotiating some goodies.
5. Money in your bank never did you any harm. Think twice before spending it.
6. When in doubt, go open an FD in your mom's (or other family member) name. Save tax, safe returns and you get to be a good son. FD gives you the right to get a credit card too.

All this applies if you a middle class Indian. Bhtt paisa h to to tension ni lene ka, manager ghat ake deke jayega infinia.

how does opening a FD on my mother’s name save taxes?

 

[vishalgupta2]

Any of the following cards give points for insurance premium?
Axis Olympus
HDFC Infinia (Plastic)
HDFC DCB (Plastic)
Amex Platinum Charge
Amex Platinum Travel

I know the Apay voucher route, but I need to pay 2L (2 x 1L) and with the above cards and supplementary on HDFC cards, I can buy only buy about 60k

Do I get points for topping up Apay through any of the above?
Any other tricks to get some extra points?

 

[Credit_Cards]

why is it a black hole?

thats the gravitational pull of ULIPs