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Here’s An Investment That Secures Your Family And Also Beats Inflation

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Here’s An Investment That Secures Your Family And Also Beats Inflation

Your uncle retired in 2001 and thought that his Rs 30,000 monthly pension would suffice for the rest of his life. Today, that money roughly buys a third of what it bought then*. No wonder he is always complaining of inflation. But that’s the damage inflation does—silently devouring your money.

Inflation: the silent monster

Inflation keeps devouring your money even when it grows through your investments. As a result, you end up saving less than what you need.

If your investment provides an annual return of 7% and the inflation is 7%, your money is effectively not growing, after adjusting for the impact of inflation.

To secure your future, you need to beat the inflation but the question is how.

Why you need equity investments

The answer to beating inflation lies is making investments that grow well. The good news is that you can do that by easily investing in equities. Over long periods of 8-10 years or more, equities typically grow faster than alternative investments such as debt investments like fixed deposits (FD) and real estate. In the last 15 years, equities as represented by BSE benchmark stock index, Sensex, grew at 16.11%** annually.

Harness the power of equity with ULIPs

Individuals typically do not have the time or the expertise or time to invest in equities. That is why unit linked insurance plans (ULIPs) from life insurance companies come in so handy. By investing in them, you get to invest in equities and avail of the expertise of expert fund managers.

To sum up, inflation maybe your constant enemy but you can take the bite out of it with typically high growth investments. In ULIPs, you have a weapon to protect the growth of your money.

  • Annual inflation of 7.10% during 2001-16; source: Ministry of Labour & Employment, www.inflation.eu
  • 10 year period ending June 30, 2017

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