A ULIP plan is essential when you require high life cover and maturity returns from the same plan. Their high returns become useful for any expected and even unexpected occasions in life.
But before you move ahead with investing in ULIPs, you must also know the premium and maturity amounts. It will help you manage your investments and realise the returns of a plan. A great tool that can assist you here is a ULIP calculator. Read on to know more about the ULIP calculator and how it becomes crucial while investing in ULIP plans.
6 Benefits of Using a ULIP Calculator
A ULIP calculator is an online tool hosted on the website of insurers and financial organisations. They help the user decide what amount they should invest in a plan to obtain the desired maturity amount. They do require some more details about a selected plan for the calculation. And if they are on the website of a ULIP life insurance provider, they give the user options to select the available plans and covers. Below are six main benefits of using a ULIP calculator, which promote its importance.
Accurate Calculations
One of the major reasons to use a ULIP calculator is its accurate calculations. Such accurate calculations are not possible for manual pen and paper calculations using actual calculators. ULIPs have dynamic interest rates and use compound interest to credit interests. Such hard calculations will always have some mistakes while carried out manually.
Goal-Based Premium Calculation
In the ULIP calculator, a user can input the maturity returns as per their monetary requirement for a future occasion. And the other input details, such as interest rate, premium payment frequency, and the investment duration, are on the basis of any selected plan. So, it is a goal-based calculation that factors in the needs of a user and the basic features of any selected plan to provide the result of the required premium amount.
Reverse Calculations
Some ULIP calculators also allow reverse calculations. So, if you have a particular premium amount in mind, you can input it, and the calculator will provide the expected maturity amount. Thus, ULIP calculators allow you to choose plans based on your investment capacity rather than existing ULIP plans.
Up-to-Date Plan Details
These calculators are available on the insurers’ websites, so there won’t be any errors regarding the figures. The data will be as per the latest revised brochures of the plan. So, you get the updated plan details from the calculator.
Exact Rates for Add-Ons and Covers
In ULIP plans, you can add several rider covers and add-ons. So, these calculators also have the facility to add the rates of the covers and add-ons, thus reflecting the actual cost of investing in the ULIP plan.
A Free Plan Creation Tool According to Personal Budget
One of the major benefits of using a ULIP plan calculator is that it is free to use. Almost every online ULIP plan calculator is free, although some may ask for a few personal details before allowing access. Such a free tool helps people create a ULIP plan based on personal choices, and the budget becomes crucial in knowing the outcomes of plans. It, in turn, helps them compare various plans based on their outcomes for the same investment amount and choose the best one among them.
Knowing these important outcomes of using a ULIP calculator will enlighten you to use one before your investment. And these days, it is necessary to use such tools to plan and budget the contributions and earnings of ULIP plans.
