How Capital Guarantee Plans Ensure Financial Security for Investors? - World News Network

VMPL
New Delhi [India], January 6: If you are looking for high returns but also value the security of guaranteed benefits, capital guarantee plans can be ideal for you. These plans offer the potential for capital growth along with guaranteed returns. They combine market-linked funds with the assurance that your initial investment is protected. No matter how the market prevails, you will receive the full amount you invested back when the plan matures.
Let’s find out more about capital guarantee plans and how they can offer financial security.
How do capital guarantee plans ensure financial security for investors?
Capital guarantee plans provide financial security by combining guaranteed returns with life coverage. These insurance-backed plans include a life cover to ensure your loved ones remain financially protected in your absence. Additionally, they promise a 100% return of your invested capital, regardless of market fluctuations.
Whether the market rises or falls, your principal investment remains safe. While you get to earn returns if the market performs well, you also receive your full investment back at maturity during market downturns. Unlike other investments, where returns are uncertain, capital guarantee plans eliminate unpredictability. They offer the assurance of getting back your invested sum at maturity. This kind of financial security is hard to find elsewhere.
Moreover, these plans not only safeguard your investment but also allow for wealth creation. They can help you prepare for essential expenses, ensuring a secure financial future.
Other ways that capital guarantee plans provide financial security
A) Through tax benefits
In Capital Guarantee Plans, investments are eligible for tax deductions under Section 80C of The Income Tax Act, 1961, allowing deductions of up to Rs 1.5 lakh annually. Additionally, the maturity amount received is tax-exempt, provided the annual premiums paid do not exceed Rs7.5 lakh, subject to conditions under Section 10(10D) of the Income Tax Act, 1961.
B) Through portfolio flexibility
Capital guarantee plans allow you to build a diversified investment portfolio aligned to your financial goals and risk appetite. They offer a variety of fund options broadly categorised into equity, debt and hybrid funds. For instance, if you have a higher risk tolerance, you can allocate more towards equity funds. On the other hand, if you have a low-risk appetite, debt funds may be more suitable.
C) Through Systematic withdrawals
Capital guarantee plans offer systematic withdrawal, which allows you to withdraw money periodically from your plan to meet your liquidity needs. You can draw your returns to cover your essential and non-essential expenses and enjoy greater financial security without disturbing the overall investment plan.
Conclusion
Capital guarantee solutions are versatile financial tools suitable for various life goals, including retirement planning, funding your child’s education or homeownership. With the unique combination of capital protection and potential for growth, these plans provide you with financial security and life insurance benefits. You get back your invested capital while chasing opportunities for wealth creation.
Disclaimers
Tax benefits may be available as per prevailing tax laws. Tax benefits under the policy are subject to prevailing conditions and provisions of the Income Tax Act, 1961. The tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details.
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