What Makes Money Back Plan The Best Investment Option?

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Investment is the best financial tool when it comes to secure or create the future of you and your family as well. There are a few plans that completely focus on the investment part whereas there are some plans that offer insurance only. There is no doubt in saying that each and every insurance product is different from others and carries different sets of advantages as well. However, on exploring, you will get to know that there are a few plans that offer insurance coverage along with good returns.

A money-back plan is an effective form of life insurance plan that offers great returns at regular intervals. It is a good investment option for all where it is easy for them to manage their savings and liquidity also. In the case where the insured passes away during the tenure then all the benefits will be transferred to the nominee as per the stated in the documents.

Deciding factors for Money Back Plan Premium Calculation:

When it comes to money back plan, there are multiple factors that play an important role. A few of them are stated below:-

Age- The age of the inured plays an important role. It will decide the amount of premium that you have to pay for your money back policy. Investing in this plan at an early age will cost low as compared to buying it later.

Habits- There is no doubt in saying that your smoking habits can also affect the premium amount. It is a major deciding factor when it comes to calculating the premium amount. Consumption of tobacco, alcohol, and other intoxicants can highly affect a person’s health and can increase the risk to one’s life that leads to higher premium charges to cover life risk. 

Your health is also a factor to decide your premium-amount calculation. In case, you have any serious illnesses such as cancer, heart attack, diabetes, etc., you might have to pay a higher premium as compared to the individuals who are not suffering from such major health issues. 

Gender- You might be not aware of your gender also plays an important role when it comes to deciding your premium for money back policy. As per the statistics, women have a higher life expectancy as compared to men that’s why insurance companies charge higher premiums for male policyholders. 

Your profession also plays an important role in deciding your premium amount. For example, if your profession comprises of risky tasks that include pilot, driving, mining, fisheries, etc., you will be charged with a higher premium-amount for covering your life. 

Below enlisted is the key point that makes it plans the most popular investment instruments:

A regular flow of Income:
As its name suggests, money back plans are designed in a way that can offer regular payout during the policy tenure. This payout is also popular by the name of survival benefit. This amount is paid at regular intervals until the term completion (maturity) of the plan.

The best thing about this plan is to fulfill your financial requirements without waiting for the plan’s maturity. However, it’s important for you to note that the advantages are only applicable to the policyholder and are not transferable to the nominee.

Note: You should ensure that the regular pay-outs provided in a money-back plan should be enough to meet your expected financial costs. It would be great if you can analyze the past performance of a plan before investing in it, as it will give you an idea that how insurance companies deal with the insurer.

Money-back plans are a low-risk investment as compared to other investment options such as mutual funds, stocks, etc. Such forms of investment are usually comprised of high risks because of volatile capital market conditions, but the case of money back plans is totally different. Hence, people with a low-risk appetite can certainly go for these insurance cum return products.

To Sum Up:

Looking for such benefits that a money-back plan holds, it becomes one of the most beneficial and favored investment options among all investors. In short, money back plans offer the opportunity to help your family with financial goals in unfortunate circumstances when you won’t be with them anymore.  Moreover, the feature of the regular pay-outs feature in a money-back plan helps you meet your financial commitments at various stages of life.

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  • Rajesh Patil @Rajesh Patil
    is this really a advise? I can't believe there are such financial advisors on this planet, who gives such a worst advise, if you don't have something to give them better, keep quite and do your job.
    Like 0
  • Abhishek Kumat @Abhishek Kumat
    probably the worst advise that any good financial planner should give to their clients ... always follow one basic rule : never mix investing with insurance .. both have separate objectives , treat both separately and you will always do better. the simplest advice would be to go for term insurance for insurance and investment based on your risk appetite and goals
    Like 3
  • migukant parekh @migukant parekh
    Very helpful
    Like 1

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