Revisiting complete financial planning amid COVID-19 Scares? Here are the instruments you need

The recent drastic changes in the world economy fuelled by the Covid-19 pandemic need no introduction. If you have been closely monitoring the global markets, you would have noticed the volatility that they are experiencing. The Indian stock market (SENSEX) recently lost close to 3,900 points in a single day. And all these factors would have made you look at your own investment pool again. As coronavirus continues to spread across the globe, there are various unsettling questions that you probably have about your financial plan. And if you are one of those investors who make active decisions to re-evaluate your choices and dives deeper into the performance of the funds, there’s something you definitely need to double-check: Do you have the financial plans that can balance out your risks to give you safer and more secure returns?

While the world markets are all showing bearish trends, coping with the stress of the coronavirus spread, there is hope for change. A quick look at the current state of the pandemic as well as the financial crisis management in China proves that recovery is actually possible. With the governing bodies and organizations across the country rolling out plans to tackle the crisis, investors seem to slowly trust the market again. Making the silver lining thicker, here are three primary funds that can avert your risks and help you design a balanced financial portfolio.

ULIPs
Investing in the stock market has its pros for sure, higher returns being the top-most one. However, ULIPs offer entry into equity-linked investments while also providing Life Insurance. ULIPs offer a great option for wealth creation and their minimum 5-year lock-in period ensures that you have an insurance cover in your financial plans, preparing you for uncertainties. ULIPs give you the liberty of choosing from Equity or Debt related funds or a combination of both, depending on your preferences and risk-taking abilities.

Past market trends have proven that staying invested for long-term, even in the current market selloff, can help you in earning good returns on equity funds. A quick look at Bajaj Allianz Life’s key active equity ULIP funds and their rates of return over long periods stand proof to this fact.


These key equity funds have managed to outperform the benchmark index and peer category over most time periods, indicating a strong performance track record. Based on these numbers, it is safe to say that opting for ULIPs as a long-run investment is a great investment strategy.

Some of the newer ULIP plans also return mortality charges in the plan, making it a more competent option overall. Top players like Bajaj Allianz Life Insurance offer tailored ULIP plans such as Bajaj Allianz Life Goal Assure, Bajaj Allianz Life Future Wealth Gain and Bajaj Allianz Life LongLife Goal which come with several new-age features. You can easily choose from an array of ULIPs and try to balance your risks responsibly.


Guaranteed Return Products
In a world full of uncertainties, it is always reassuring to have a few guarantees. That is where Guaranteed Return Products step in. These non-linked non-participating endowment plans offer a guaranteed return on your investment and can serve as a great option for people who are trying to steer clear of any volatility. In fact, Guaranteed Return Plans like Bajaj Allianz Life Guaranteed Income Goal are perfect if you are looking to systematically invest year on year, and are looking to receive guaranteed benefits a few years down the line.

The current and consistent rate cut by RBI to 4.4% in efforts to ease the financial stress caused by Covid-19 has, in turn, affected several Fixed Deposit returns. In the given circumstance, Guaranteed Return Plans like Bajaj Allianz Life Guaranteed Income Goal provides an option to lock into guaranteed returns for longer periods like 10-12 years. And since Life Insurance companies review returns based on the fluctuations in the G-Sec rates, now is the time to invest in Guaranteed Return Products.

Term Plans
Term plans are pure insurance plans that offer a security cover to your family during sudden uncertainties like death. We are all burdened with an array of monthly payouts, be it home loan EMIs or your kids’ school fees. And term plans can help the insured’s families tackle these financial battles, in case of unprecedented adversities. Its compulsory fall back option ensures that your family’s lifestyle and life goals are not disturbed from a financial standpoint. The Married Women's Property Act, 1874; also ensures the insurance money is directly received by the wife, ensuring the financial security of your spouse.

Experts often advise that life cover amount should include financial protection for your family, cover your liabilities like home loan and life goals like child education

While most people may argue that term insurance is not for the young, the premiums are in fact lower if you purchase the policy when you are young. New-age term plans like Bajaj Allianz Life Smart Protect Goal offer Life Cover of Rs 1 crore for 30 years with premiums starting as low as Rs 13 per day for a 25-year-old healthy man which can be availed from the company’s website. It has variants with benefits of Return of Premium, Child Education Cover, Cover for spouse, etc. in the same policy which further add to the benefits of this plan.

In addition to the individual benefits that each of these plans offer, they are also go-to ways of saving taxes. Since these investments are linked to insurance, they all offer Tax Benefits under section 80(C) of up to 1.5 lakhs and proceedings are tax-free under 10(10D), provided your sum assured is 10 times of your premium in the old tax regime. Market uncertainties are a part and parcel of investments; however, with the right options and the perfect balance, you can make sure that you are prepared for them and for uncertainties in life.

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