Stocks & Investing
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Stocks and Investing
Fri, December 13, 2024 
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How ULIPs are different from MFs
- Mutual funds invest in financial assets with strict SEBI norms, transparent disclosures, and standardised fees, making them ideal for focused investing. Unit Linked Insurance Plans (ULIPs) combine investments with life insurance,
The article from The Hindu Business Line discusses the differences between Unit Linked Insurance Plans (ULIPs) and Mutual Funds (MFs). ULIPs combine insurance and investment, allowing policyholders to invest in various funds while also providing life insurance coverage. A portion of the premium goes towards insurance, and the rest is invested in equity, debt, or balanced funds. They offer flexibility in switching between funds, tax benefits under Section 80C, and the maturity amount is tax-free if the premium does not exceed certain limits. On the other hand, Mutual Funds are purely investment vehicles without an insurance component, focusing solely on wealth creation through diversified investments in stocks, bonds, or other securities. MFs offer various schemes like equity, debt, or hybrid funds, with returns linked to market performance. They do not provide life insurance but can offer tax benefits on certain types of funds like ELSS. The key distinctions lie in ULIPs' dual benefit of insurance and investment, lock-in periods, and charges, whereas MFs provide more liquidity, lower costs, and a broader range of investment options without the insurance aspect.
Read the Full Business Line Article at:
[ https://www.thehindubusinessline.com/portfolio/personal-finance/how-ulips-are-different-from-mfs/article68981217.ece ]
Read the Full Business Line Article at:
[ https://www.thehindubusinessline.com/portfolio/personal-finance/how-ulips-are-different-from-mfs/article68981217.ece ]
