Manish’s father always had one piece of advice for him growing up. “Don’t make the same mistakes I made. Make sure to start your investments early, so that you can reap consolidated benefits.” Manish had just graduated from college, and was already rearing to start his investments into instruments that would reap him long-term returns. He already knew that he should invest in ULIPs to get the dual benefits of both insurance and investment. However, as he saw others his age spending their first salary on enjoying themselves, he felt a little uncertain about the choices he was making. Manish approached a financial adviser, and asked whether it made a difference if he began investing in his early youth or whether he was 40 years old.

Unit Linked Insurance Plans (ULIPs) act both as coverage and also as an investment instrument . Investing in a ULIP scheme allows investors to reap high returns by investing across a bouquet of funds, which offer diverse benefits. By investing in a ULIP, investors can choose to diversify their fund across equity funds which offer high returns but carry a high level of risk; as well as debt funds which guarantee security but offer lower returns. The beauty of ULIPs lies in the fact that with the funds portfolio diversified, it is possible for investors to build a substantial corpus over a period of time. ULIPs are especially coveted for the long-term benefits they offer.

With any investment, it is advisable to start investing at the earliest. Both with insurance and investment, investors who are younger are offered more benefits than older investors. It is possible to verify this by accessing the ULIP calculator available on most investment portals. The benefits accrued for those who are younger are significantly higher than those accrued by older investors.

Read on to learn the benefits of starting to invest in the ages of 20s and 30s.

1. Bigger corpus:

Beginning to invest early yields a more substantial corpus when one is older. Since ULIPs are a long-term plan, if one begins investing when they are 20 years old, it will allow them to save up much more by the time they are 70 years old; than if they had begun investing at the age of 40 years. Use a ULIP calculator to accurately estimate the funds that will accrue at the end of the term, if investments are begun when people are in their 20s or 30s.

2. Insured life from the beginning:

When people are young, they are more tempted to spend money on frivolous activities. By investing in a ULIP when they are in their 20s, people can ensure life coverage for themselves regardless of the amount of money they spend otherwise. Additionally, younger people need to pay lesser amounts as premiums to avail a greater range of benefits, as opposed to those who are older.

3. Tax Savings:

Regardless of the age of the investor, tax savings are always valuable. By investing in ULIPs at an early age, investors can ensure tax savings for themselves and ensure greater savings over a longer period of time.

4. Fund goals as and when they arise:

When a person is young, their goals are more likely to change and that too more frequently than when they get older. If an individual invests in ULIP when they are younger, they can themselves fund their educational goals or any other goals as they arise. Since most ULIPs allow for partial withdrawal of funds, these plans can also be used to fund vacations and holidays to exotic locales with friends, or weddings or even any further education. An investor can use a ULIP calculator to estimate how much they need to save up over a period of time, in order to have access to a reasonable corpus at their time of need.

5. Disciplined savings:

Savings are a habit that are inculcated in people with a lot of difficulty. By beginning to invest in ULIPs from the time they are in their 20s or 30s, investors can develop a habit of saving which will aid their life in a number of ways over the years. With ULIPs, investors can also begin saving up for long-term plans such as for their children’s education or even marriage.

Beginning investments early on when there are more resources to save is very beneficial since it leads to a more significant corpus when the person gets older. Generali Central Big Dreams Plan allows youngsters in their 20s and 30s to invest only Rs. 2,000 a month which can build up to a substantial corpus by the time they are even 60 years ago. The ULIP calculator on the website allows people to accurately judge how much their returns would amount to, over a period of time.