Nowadays, a car is more than an object of utility. It takes you from Point A to B, but it also is an indicator of where you are in life. A smaller car may suggest bachelorhood, fewer means, or even just a pragmatic nature. A larger car may suggest a bigger family, being accustomed to space, being accustomed to certain aesthetic styles, or just a lavish lifestyle. A sports car, well, that’s all about largess and life in the fast lane (though we’re not sure which lane that is in the congested, traffic packed roads of most of our cities).
No matter what car you may want (and, more importantly, need), it is important to not over spend, or spend beyond our means. Causing any unnecessary financial crunch can come back to bite you in a moment when you desperately need those funds. However, this doesn’t mean that you must compromise on your taste or that dream car you’ve been salivating over. All it takes is a little bit of financial planning and you can make that dream car a reality!
Wondering how? The answer is simple: you need to invest in a ULIP. Here’s why:
1. You can invest for shorter terms
When most people think of investments, they think of large brackets of time – 10, 15, 20 years. No one can be expected to wait for ten whole years to buy that one car! So people often think investing and growing their money is a solution that’s more ideal for long term plans and not immediate, short-term needs. However, there are ways to invest your money and meet your needs without waiting a decade. The minimum lock in period for a ULIP is 5 years. Therefore, you ca arguably plan out the purchase of your dream car right at the beginning of your career, and then buy one when the policy matures.
2. You get higher ROIs
With a ULIP, expecting high ROIs is the norm. If you compare the kind of ROI you can get from ULIP with just starting a fixed deposit account for the same needs, you’re much more likely to gain more money if you have a ULIP.
3. You don’t have to worry about paying interests
When you take out a personal loan or any other kind of loan from a bank, you’re often given a rate of interest that is pretty high. The monthly pay back can amount to a sum that you’re not totally comfortable with. However, with ULIPs, you can design your own premium amount and ensure that it’s affordable. This way, you can save money and buy that car you want without having to compromise on your lifestyle or watch your monthly expenses too much.
4. You have lower risks
When compared with other investment options, ULIPs present a lower amount of market risk. Of course, everything has a market risk and there’s no such thing as a risk-free policy. But ULIPs have generally considered a far safer bet when compared to other investment options. As someone making one of their first milestone purchases, the last thing you need on your plate is large variables and risk factors.