LIC's newest policy was able to collect over Rs. 8000cr inspite of LIC promising the real returns to be 4% - 7.32%. The 10% guaranteed returns promised by your friendly agent was just a marketing gimmick to make it look like a worthy investment. PPF gives you an interest of 8% compounded which is still better than Jeevan Aastha, the 0.068% calculated for 10yrs will work to be Rs.3000.00 for Rs.25000.00 of investment.
Jeevan Aastha looks good only if you plan to lock your money for the next 10yrs, this means you will not have liquidity for the next 10yrs and if interests rates go up than you will miss the bus, unless you choose to pay the 10% exit load to break your Jeevan Aastha policy before the term period.
If you ask me I would never lock my money for next 10yrs as a lot can happen in the next 10yrs. Maybe LIC can go bust just like UTI - 64. UTI was also guaranteed by the government. The tax laws can change.
The other option to this would be to invest in Bhavishya Nirman bonds (NABARD) which provide a 8.5% returns post taxes or 8.29% after taxes which are also guaranteed by the government. The funny part is LIC can invest your money in these bonds and make profits at your cost.
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