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Long-Term Investment Plans

What is the meaning of long-term investments?

Long-term investments refer to investments held for one year or longer. Long-term investment plans typically provide higher returns when held for a longer period of time. They are typically used to meet future needs, such as covering your child's education expenses, post-retirement needs, and more.

Long-Term Investment Plans

How to plan for a long-term investment?

Long-term investments can be planned based on your goals, your current income, and the expected returns from your investments. For example, if you are in your 30s and saving for retirement, you have about 30 years to build assets before you retire. However, if you are saving for your child's education, you will have a shorter investment period of 10 to 15 years. So the investment plan will vary accordingly.

7 Benefits of Long-Term Investments

  • The power of compound interest: the more time you give your investments to grow, the higher the returns. For example, a small amount of 500 euros invested monthly at an interest rate of 15% can grow to 16.42 lakhs after 25 years.
  • Safety over short-term volatility: It is difficult to predict market conditions correctly, so it is good to invest for the long term to gain maximum benefits. If you stay invested for a longer term, you can offset short-term fluctuations.

  • Targeted planning: since you are investing for the long term, it allows you to plan for important milestones such as buying a house, children's education, retirement, and more.
  • Convenience: you do not have to worry about the maturity date of the investment. All you need to do is send a one-time instruction to your bank to enable automatic debit from your bank account or credit/debit card. In addition, you can purchase long-term investment plans online at any time with just a few clicks*.

  • Tax Benefits~: Long-term investment plans make annual tax~ planning easier. All you need to do is to buy a long-term investment plan and invest regularly to avail the tax benefits under the Income Tax Act, 1961. This means that you not only grow your money, but also save on taxes.
  • Less impact of market fluctuations: Small market fluctuations do not affect long-term investment plans as much as short-term investment plans. Therefore, you can remain worry-free with long-term investments.
  • You have more time to try different funds to get maximum returns: Long-term investments give you ample time and opportunity to switch between different funds and balance funds that are not profitable.

When you buy ULIPs as a long-term investment option, you enjoy all the above benefits and more.

  • Flexible investment options: ULIPs give you the flexibility to invest in a variety of fund options - equity, fixed income and balanced funds - depending on your risk tolerance. You can also switch between different funds depending on market conditions. Staying invested for a longer period of time and having a switch option can help you get the maximum benefit.
  • Targeted planning: since there is a minimum lock-in period of 5 years, you can use ULIPs to fund your long-term goals, such as buying a house, funding your child's university education, your retirement, etc.

  • Loyalty Supplements^: If you stay invested for a long period of time, you can earn loyalty supplements^ that help your money grow without further investment.
  • Partial Withdrawal$: Beginning in your sixth year, you can withdraw up to 20% of your investment in ULIPs, provided the money is not in the Discontinued Policy Fund, to meet future needs and grow the remaining investment.
  • 'Life Protection': in addition to growing your wealth, ULIPs are useful for providing for your family's future in your absence. In the event of your sudden death, your authorised representative will receive a lump sum to secure his or her future.

How to buy online?

Investing in one of the long-term investment products like ULIPs is now just a few clicks* away. You can generate the free quotes for a long-term investment plan by entering information such as gender, age, mobile number and email ID. If you are satisfied with the offers, click to go to the application form where you will need to provide details such as proof of identity and bank account information to purchase the plan. If you have any questions, call the customer service centre or ask for a call back.

For example, if you want to invest in the ULIP ICICI Prudential Smart Kid Plan to save for your child's education, you can purchase this policy online as follows:

When to choose long-term investment above short-term investment?

Long-term and short-term investments serve two very different purposes. Long-term investments are more lucrative over time. These plans are ideal if you are saving for your long-term goals, such as your child's education or wedding, buying a home, retirement, and more. They allow you to build a large fund over the years. They also offer tax advantages~ that further increase your savings.

Short-term investments, on the other hand, can be used to achieve short- or medium-term goals, such as buying a car, taking a trip, or paying off debt. Short-term investments can pay off in a short time, but they can also result in higher taxes.

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