I have seen many people buying insurance policies as investment choices and they seem very happy that they will be getting return & protection in combination. Investing deeper they are paying a huge amount as premium for very low protection cover & returns are somewhere equal or rather low than the current Inflation rate.

Mostly we do not consider or try to know about the inflation (Read another Article) which is actually eating the value of our hard-earned money in the long run. From my point of view, Traditional Policies are of a mixed pot of porridge & not fulfilling any of our immediate personal Finance Requirements.

Protection- If we consider for life protection then the kind of cover provided in such plans against the premium paid is not worth of the human life value. It is highly advisable to buy pure term plan to protect our lives for very low premium against substantial cover.

‌Savings- If we call it as our saving then there is no liquidity and flexibility available under such plans. Anything which is illiquid & not beating inflation is not recommended as saving products. You can always go for liquid fund in Mutual Funds or short term FDs as saving instruments.

‌Investment- If we are considering them for investment purposes then there are many better products available in the market which can give much better returns. Go for pure investment options with capability to generate high returns in long run like Equity Mutual Funds, Large Cap shares etc.

‌‌ We can always choose better options when it comes to either Protection, Savings, or Investment. Mixed Products will lead you to mixed outcomes and not going to solve any purpose. Allocate the money in Pure Protection, Pure Saving, and Pure Investment products. All such plan has options for tax savings as well so nothing is there for an excuse to buy traditional insurance plans.

‌‌Evaluate your investment & make proper allocation or take a piece of expert advice to streamline the portfolio. Time is actually killing the value of your investment if you are not making the right choice. We always have a choice whether in terms of Personal Finance, make a better one.

‌All the views are personally unbiased & this has nothing to deal with promotion or demotion or any financial products. Investments in Mutual funds are subject to Market risk, please read the offer documents carefully before investing.

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