ULIP query

[bininishere]

I am 24 years old, single, working in a pvt bank with a 4 lacs annual package.

I am having one Bajaj Allianz "Family Assure" which was taken in August 2008. Now I have payed off all the premiums - a total of 30,000Rs. But the fund value now showing is 21,309 Rs only...Almost a 9000 Rs less.

I have taken this insurance after my friend's words and now I have realised that this plan is not suitable for an younster like me..This policy gives a coverage of 50,000Rs only for 10years along with some savings. I feel instead of this Family insurance plan, I should have taken any pension plans..

When I checked with the Bajaj Allianz, they told about the high intial charges applicable on this ULIP and suggested me to do the withdrawal once the policy completes 3 years (on August 2011) and invest in their other policy.

Considering an inflation rate of 5 or 6 %, is that be right to expect a rise in fund value in the next 1 or 2 years? What should I do to get back atleast my investment?. Should I do a surrender and invest in gold instead? or should I break down the 20000Rs and invest in any equity through SIP?

Please advice me.

 

[venkateshiyer]

Sir, my personal advice is not to surrender now. But when the NAV goes up, at that time you can surrender and atleast get back the premiums you have paid.

You can also try Jeevan Saral offered by LIC. For youngsters like you, you can expect returns in the range of 7-8% if kept for 25 years. In the Jeevan Saral Scheme, if a person of your age is investing every month Rs.10,000 and after 27 years he can expect to get more than 1 Crore. This is one option.

The other option as regarding beating inflation, you can invest either in Mutual funds (i.e. schemes which are good thru SIP's) or buy gold and keep it for some time. Gold at any times gives appreciation.