“Ohh !! Did I log on to a wrong page?? I always thought this space talked about the drawbacks of ULIPs and Traditional Plans (Endowment, Money Back etc) by explaining their failure to address insurance as well as investments. So how come they became best all of a sudden??” these might be the thoughts coming to the readers’ minds who have been visiting this space for quite some time now.
However, some people keep asking me that “if ULIPs and Traditional Plans were so bad, then they would not have existed in the market for so long. There might be ‘some’ people for sure, for whom they are good.”
I said, “Ok, let me do some study and find out, which could be those people for whom ULIPs and Traditional Plans could be good”. Below, I have tried to identify a few groups those who can be benefitted a lot from these. Please see if you belong to any of the below groups. If yes, then ULIPs and Traditional Plans are the “Flavour of the Season” for you.
1. Insurance Companies
If you are a insurance company (whether promoter or employee), then you have to make sure that you always keep talking good about ULIPs and Traditional Plans. Because these are the products in which your company can deduct high amount of charges and earn a lot. Only from these earnings your fat salaries, lavish offices, fat bonuses and foreign trips can be funded. Just selling term plans might be beneficial for the clients, but not you. So make sure to keep endorsing ULIPs and Traditional Plans, whenever you are talking to people.
Whether to buy it for yourself ?? Well, not really !! You are already a part of the financial industry. So you would be pretty aware that an SIP + Term Plan Combination would work wonders for you. Let the ULIPs and Traditional plans be for others, not you.
2. Incompetent “Advisors”
Are you worried about your shrinking revenues because of “No Entry Load” in Mutual Funds? Do Clients give you tough times when you ask for a fees ? Not to Worry !! ULIPs and Traditional Plans hai na !!
These Will take care of your remunerations by giving you fat commissions. Also, make sure that you force the client to buy it in the first go so that, even if he wants to change his mind later, he is stuck so badly, that he cannot exit the plan. So you become a successful “Advisor” and your revenues swell up.
Whether to buy it for yourself ?? Well, you will have to !! This is coz companies might give you targets in terms of premium amount or number of lives covered. When you will not be able to fulfil the target from external clients, you will have to put some “business” either in your name or your family members’ name. Meanwhile, don’t shy away from mis-selling, coz that’s the sole mantra to sell all these plans. Telling the truth about these products might hamper your business.
3. Looking-For-Free-Advice Investors
Do you feel that investment advisors are incompetent and crooked guys and do not deserve a fees? Are you looking for some free advice + some passback on your investments / premium payments? Welcome to the world of ULIPs and Traditional Plans !!
Here they wont demand any “explicit” fees from you. On the contrary, some might give you a pass-back of the commission they get. What a great deal !! isn’t it ??
Charges ?? Ohh Come On !! Why bother about the charges the insurance companies would deduct from your investment amount ? That is anyways not being told to you. At least you did not have to pay any fees.
Low Insurance Cover ?? Its ok !! At least the premium paid is coming back to you (Maybe at a much later time, when its value would be nothing) But it is coming back to you. Anyways, nothing is going to happen to you. Why let the money go “waste” by buying a term plan?
Low maturity amount ?? Doesn’t really matter !! The amount appears big enough today. What might be its significance after 20 years? Why worry about it today? We have lot of time to think about it “later”.
Congratulations !! You just went through the list of groups for whom ULIPs and Traditional Plans could be the best. You may just think and decide if you belong to any of the groups above.
If not, then you need to think about some better plans than these. Think about it !!
We look forward to your feedback and comments on the above article. Please feel free to contact us on saurabh.nidhiinvestments@gmail.com if you have any questions.
(In the above article, the author has made use of sarcasm to explain a few concepts. The readers are advised to use their own judgement and consult their investment advisor before making any investment decisions.)
#NidhiInvestments
#ProfessorBajaj
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Prof. Saurabh Bajaj is an Author, Mentor, Motivational Speaker and Wealth Planner.
He has done his MBA from Narsee Monjee Institute of Management Studies (NMIMS) Mumbai, one of the top 10 management institutes in India. He holds the prestigious FRM (Financial Risk Manager) degree awarded by Global Association of Risk Professionals (GARP), USA. Till date, there are less than 15,000 professionals in the world, who have been honored with this degree. He has also been awarded CFGP (Chartered Financial Goal Planner) Certification by AAFM (American Academy of Financial Management).
After his MBA, he joined J P Morgan, the second largest Investment Bank in the world. He has worked with J P Morgan as Risk Analyst for more than two years.
Prof. Bajaj also holds an Advisory certification awarded by AMFI (Association of Mutual Funds of India). During his stint at Bombay Stock Exchange, he has handled Investment Management and Treasury operations of the BSE Corpus. He has set up an entrepreneurship venture in the field of Wealth Planning and Investment Consulting under the name “Nidhi Investments” and holds the profile of CEO.
Prof. Bajaj sits on the Expert Panel of CAClubindia.com and MBAClubindia.com as Investment Expert.
He is actively involved in investor education through his blog www.professorbajaj.com which has a readership from 78 Countries all over the world. His articles are also regularly published in caclubindia.com , mbaclubindia.com , totalca.com , charteredclub.com, bankbazaar.com and lawyersclubindia.com .
He has been awarded the title of “Best Article Writer” from caclubIndia.com in Jan 2012 and has been selected amongst “Top 5 Technical Writers” from all over India in Feb 2013.
He has been invited by various TV Channels like SPIN TV, CNBC TV18, UTV Bloomberg Etc for programs like "Expert Advice" , "What Markets Want ", "Budget Analysis" etc.
He has been invited by Several organisations like Lions Club, Rotary Club, Agrawal Welfare Foundation, Rajasthan Mandal, Agroha Vikas Trust, Union MF, UTI MF, Arthamitra Gurukulam, Vidyalankar Institute of Technology etc for expert lecture on "Smart Investing", "Life is A Celebration", "Financial Freedom", "The Digital IFA" etc.
He was ranked 8th Merit at All India level NMAT which got him selected for MBA programme at NMIMS, Mumbai. He did his MBA with Capital Markets as his specialisation.
Soft Skills has become an inevitable part of every selection process and teaching learning process these days. The students from small towns and tier II cities, in spite of being talented and well equipped with technical skills, are seen struggling in the selection process. This is because of their lack of exposure to these soft skills. Mr. Bajaj has a zeal for training candidates to develop these skills and has been imparting the same on since last two years. This zeal and passion inspired him to set up his own firm called “Knowledge Circle” which aims to train candidates for soft skills.
Till date, he has trained more than 5000 participants from over 220 organizations across various fields of soft skills.
He has been associated with MSBTE (Maharashtra State Board of Technical Education) to conduct Soft skills training workshop for the faculties of Polytechnic Colleges in Entire Maharashtra (Mumbai Region, Pune Region, Aurangabad Region and Nagpur Region) since last 8 years.
He has also been associated with ICAI (Institute of Chartered Accountants of India) for training CA Students on various topics related to Communications skills, Group Discussions etc.
He was invited by Fr. Agnel Polytechnic College, Vashi for a motivational workshop for faculties. He was also invited by Vivekanad Polytechnic College for "Communication Skills and Email Etiquette" training for non-teaching staff.
Apart from these, he has conducted “Capacity Building Soft Skills workshop for Faculties” at ITI Gunj, ITI Pusad, ITI Digras and ITI Umarkhed. This was the first ever soft skills workshop for faculties in the history of ITI’s in Vidarbha. He was also invited by Shivaji Education Society to conduct similar Soft skills workshops for the faculties and office staff of Shivaji Junior College Pusad, Shivaji High School Pusad, Shivaji Vidyalaya Belora and Shivaji Vidyalaya Bhojla.
He has conducted training workshop on “Effective Presentation Skills” for the relationship managers of HDFC Mutual Fund, Andheri Branch, Mumbai.
He has also been invited at College of Management and Computer Science, Yavatmal, College of Dairy Technology, Warud, B N College of Engineering, Pusad, B D College of Engineering, Wardha, College of Engineering and Technology, Akola, Dr.N.P.Hirani Institute of Polytechnic, Pusad etc. for the Guest lecture on “Developing Interview Skills”.
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Sir Jee….. Sach me Dara diya yaar aapne….. aisi khatarnaak Head line mat diya karo Bhai G…
But any way….. wo kahte h seedhi baat logo ko samajh me nahi aati to tana maar k samjhana hi achha h….
Jai Ho. Sir….
Thanks Giriraj Bhai.
Actually many people had started asking this question to me, “Koi toh hoga jiske liye ye plans achhe honge”, So I thought I would just list them down.
Thanks again for your visit and feedback. Looking forward to more in future.
Thats not fair, what about others why they are left out 😉
Nice article. At first look got shocked by title 🙂