Money Multiplying News

PLAN YOUR SECOND INCOME WITH GUARANTEED IMMEDIATE INCOME PLAN

You are introducing the Tata AIA Fortune Guarantee Supreme, a life insurance savings plan that empowers you to transform your dreams into reality. With this policy, you can enjoy guaranteed returns and life-cover security throughout the policy term. Moreover, depending on the time horizon and nature of your goals, you can receive your benefits as a steady income stream or a one-time lump sum payment.

Book immediate guaranteed Income from 1st Year of your Policy Term with a Lump Sum benefit at Maturity- Invest ?4 Lac for seven years; get Guaranteed Annual Income of ?1,15,175 from the very 1st Year of your policy term for the next 40 years with ?39,20,000 as Return of Premium at maturity. Total amount of benefits received would be ?85,27,000 (Age 35 years, Policy term 40 years, Income Term 40 years,).

>Salaried customers who desire a secondary source of guaranteed Income>Grandparents can use this as a gifting tool for grandchildren

>Parents purchasing for their children's education

SURVIVAL BENEFITS GUARANTEED AND TAX-FREE REGULAR INCOME TO THE POLICYHOLDER

>Income Start Period- First Year as per the chosen frequency by the policyholder (A/SA/Q/M)

>Income End Period- End of the policy term or death of the policyholder, whichever is earlier.

HOW TO GET 140% RETURN OF PREMIUM AT MATURITY

Example 2: MR. GOYAL, AGED 34 YEARS, WANTS A RECURRING INCOME TO TAKE CARE OF HIS DAUGHTER’S CO-CURRICULAR/TUITION EXPENSES & ALSO TO GIVE A LONG-TERM POCKET MONEY TO HIS DAUGHTER.

Have you ever considered a health insurance plan that locks in your premium basis at your entry age? Or doesn’t it let you run out of sum insured, ever? Or even helps you carry forward your leftover sum insured to the next year? Sounds impossible? Not anymore. Introducing ReAssure 2.0, a first-of-its-kind health insurance policy that allows you to make the impossible possible. The plan is packed with many industry-first features to get complete peace of mind truly.

1. Save while you stay protected as you age :Pay the premium applicable as per the age you purchase the policy and not your current age. This will continue until a claim is made. This means that if you purchase the policy at 25 years old and you do not make any claim until you are 55 years old, then you will only be paying the premium, which applies to a 25-year-old every year until you claim at 55 years old age. The premiums will return to the normal cycle after the first claim.

1. Never run out of your Sum Insured, ever: The first claim will trigger the ReAssure+ benefit forever. It is unlimited. Each claim will be up to the base sum insured. The same person can use it for the same illness. After you claim, you get the double sum insured from day 1 of the next year. This means that if you have purchased a policy with 10 lakhs of base sum insured and you make a claim of 2 lakhs that year, then the ReAssure+ benefit will be triggered, and you will get up to 10 lakhs of the sum insured, which will be over and above the balance of 8 lakhs of base sum insured. This ReAssure+ benefit will remain forever, as many times as you claim. And next year, you will get 20 lakhs of the sum insured from day 1.

1. Don’t lose what you don’t use: Don’t let go of the sum insured for which you have already paid for. Our first-in-industry benefit enables you to carry the leftover sum insured to the following policy year upon renewal. This way, your sum insured will keep accumulating with each renewal up to 10x of your base sum insured. This means that if you have purchased a policy with 10 lakhs of base sum insured and you do not make any claim that year, then your sum insured is not wasted. It is carried forward to the following year, and you get 20 lakhs of the sum insured from day 1. This sum insured will continue to carry forward up to 10x of the base sum insured, i.e. until it becomes 1.1 crores in this case. Even if you make a claim, the leftover sum insured is carried forward.

WIN-WIN FOR YOU IN ALL SITUATIONS

Designed to help you benefit beyond hospitalisation

? Up to 30% renewal discount on premium, basis the health points collected on Niva Bupa Health App.

? Unlimited e-consultations with our partners- video and telephonic ? Annual Health Check-Up starting from day 1 Designed to help you benefit at the time of hospitalisation

?Annual Health Check-Up starting from day 1

Designed to help you benefit at the time of hospitalisation

? Inpatient Care with coverage for hospitalisation of 2 hours and no capping on room rent coverage up to the sum insured.

? Truly Cashless Experience with optional add-ons: Safeguard+: Coverage for Non-payable items as per the list I, II, III, and IV of Annexure I and no impact on Booster+ for less than INR 1,00,000 claim.

Safeguard: Coverage for Non-payable items as per the list I of Annexure I and no impact on Booster+ for less than INR 50,000 claim.

PRODUCT BENEFIT TABLE (All Limit In INR unless defined as Percentage)

WHAT ARE MUTUAL FUNDS?

A Mutual Fund scheme is a portfolio created by investing in a basket of stocks, and debt securities with funds collected from several investors. Based on a team of research analysts, the fund manager decides which sector to invest in and within the sector the stocks to choose or, in the case of debt funds, the debt securities to invest in. So, when you buy a mutual fund unit, you essentially purchase a portfolio of securities in a minuscule fraction of the whole. The returns you get on a mutual fund are indicated by the Net Asset Value (NAV) of the units calculated at the end of the day. The NAV moves in line with the price of the underlying securities.

WHAT ARE EXCHANGE-TRADED FUNDS (ETFs): Exchange Traded Funds (ETFs) are also Mutual Funds because the asset manager invests in a basket of securities by pooling money collected from many investors. ETFs can be based on various asset classes like Equity, Debt, Gold, etc. In nature, they combine the features of mutual funds and stocks. While in structure and management, they are like Mutual Funds; they can be traded like stocks on the stock exchanges. They follow the principle of passive investing. Under this principle, the ETF mirrors a particular index and tries to replicate its performance. This differs from active investing, which aims to beat the benchmark index’s returns. Instead, ETFs are like close-ended mutual funds, wherein all the funds are raised initially, and then the ETF invests it in stocks mirroring the benchmark index with no further investments being allowed.

MUTUAL FUNDS Vs ETFs: HOW ARE THEY SIMILAR:

· Both Pool Money from Multiple Investors

One of the similarities between Mutual Funds and ETFs is that the funds from a range of investors are pooled together, and that money is put into a bunch of securities, which can be equities, debt, or a commodity like gold. Professional experts then manage this pool of money

· Both Offer Diversification

Mutual Funds and ETFs benefit from diversity because they are a bundle of various stocks. So, if one stock performs poorly, another can perform well. This helps you in hedging your risks. Diversification also makes them less risky in comparison to investing in individual stocks.

· Both Follow Passive Investment Strategies

Both ETFs and Index funds (a type of Mutual Fund) follow the passive investment strategy wherein the investments are made in securities in the same proportion as the index they track. This means that the weightage of each constituent in the index will have the same weightage in the fund. They both aim to deliver market returns at a low cost.

· Both Provide Professional Management

Experts manage both ETFs and Mutual Funds. The aim is to replicate the benchmark’s returns in both cases. However, differences between the returns exist, and experts try to minimize these differences.

· Both Have NAVs

Like Mutual Funds, ETFs also have Net Asset Values calculated at the end of the day. Both derive their value from the underlying assets they invest in, and the NAV is also calculated similarly. In both cases, the rise and fall in the value of NAVs represent the Mutual Fund/ETF performance.

MUTUAL FUNDS Vs ETFs: HOW ARE THEY DIFFERENT:

· Buying and Selling Method

The most significant difference between a Mutual Fund and an ETF is that while Mutual Fund units are bought and sold at the closing NAV of that particular day, the units of an ETF are traded on the exchanges just like shares. The latter can be traded throughout the day, and the value at which it is traded differs during a trading day, very unlike that of mutual funds.

· Transaction Price Determination

When you invest in a regular mutual fund scheme, including Index funds, you do so at a fixed NAV declared at the end of the day. You buy or sell them directly from the Mutual Fund house online or offline or through a distributor. However, since ETFs are traded on an exchange, you must buy or sell them through an authorized broker like you do for shares. This means you need to have an account with a broker and a Demat account and buy and sell the ETF units just like shares are traded in the stock exchange. It also means that you can buy or sell them throughout the day at whatever the market price is, at the moment, which of course, depends on the volume of trading and demand. As the demand for the ETF exceeds its supply, the market price increases, and vice versa.

· Liquidity Levels

There are fresh purchases and redemptions in Mutual Funds. This is not the case in an ETF. Once the funds are raised and a portfolio is created consisting of the index constituents that it follows and mirrors, there are no additional purchases or redemptions. It is then like a close-ended fund. Liquidity in the Exchange Traded Funds is through the demand for the traded units. This means that the more the trading volume in ETF units, the more entry and exit opportunities for investors. · Number of Investment Strategies Offered A Mutual Fund scheme can follow an active or a passive investment style. An active Mutual Fund scheme invests in?many securities.

The fund manager decides the proportion in which it is invested and makes tactical decisions about when to invest in a security or sell it. In the case of an ETF akin to a passive Mutual Fund scheme like index funds, the portfolio is constructed to replicate the underlying index and tries to replicate its performance. A regular Mutual Fund is an active fund because the fund manager can buy more or less securities according to his/her discretion. At the same time, an ETF is passively managed because it has to mirror the index.?

· Expense Ratio

A very big advantage and the difference between ETFs and mutual funds is that ETF expense ratios are very low compared to actively managed mutual funds. In the Indian context, an active mutual fund could have a total expense ratio of up to 2%, while an ETF could be as low as 0.35%. Expense ratios eat into the funds' returns, so the lower the expense ratio, the better. An ETF is, of course, subject to brokerage, securities transaction tax, and other related charges. Gold ETFs are not subject to STT, however.

· Level of Flexibility

You can invest via a Systematic Investment Plan (SIP) with mutual funds. This means that you can periodically invest a specific amount invested in a particular scheme. The same will be deducted from your bank account automatically per your instructions. On the other hand, there is no SIP facility for ETFs. If you want a SIP in an ETF, it would have to be done manually, just like you would with stocks. You could fix up an investment interval and manually ensure that you invest within those intervals. No auto-debit happens, like in the case of a mutual fund SIP.?

BOTTOM LINE :

SHOULD YOU INVEST IN AN ETF OR MUTUAL FUND? If you want to invest in a passive fund that follows an index but doesn’t want the hassle of opening a broker account, you would be better off investing in an index fund and making periodic additions. On the other hand, if you want a more active role in managing your funds and want to take advantage of market fluctuations, you can opt for ETFs. A third option is to invest small amounts in both and then take it from there, depending upon returns and comfort. At the end of the day, apart from returns, you also need to look at how easy it is to invest, whether you understand the product and your risk appetite.

Disclaimer: Bajaj Capital Limited (‘BCL’) has taken due care and caution in presenting the factually correct data contained herein above. While BCL has made every effort to ensure that the information/data being provided is accurate. BCL does not guarantee the accuracy, adequacy or completeness of any data/information in the publication, and the same is meant for the use of the recipient and not for circulation. Readers are advised to satisfy themselves with the merits and details of each investment scheme before taking any investment decision. BCL shall not be held liable for any consequences, legal or otherwise, arising out of the use of any such information/ data and further states that it has no financial liability whatsoever to the recipient/ readers of this publication. Neither BCL nor any of its directors/ employees/ representatives accept any liability for any direct or consequential loss arising from the use of data/ information contained in the publication or any information/ data generated from the publication. Nothing contained in this publication shall constitute or be deemed to constitute a recommendation or an invitation, or a solicitation for any product or service. Any dispute arising in future shall be subject to the Court(S) at Delhi. Views given in the articles are the personal views of the contributors and not that of the company. Readers are advised to go through the respective product brochure/ offer documents before making any investment decisions. Disclaimer: The rates of interest are applicable as on the data mentioned here in above. The rate may be revised at the sole discretion of the respective companies inviting the Fixed Deposits without further notice. Printed by, Rajiv Wadehra, Published By, Raji Wadehra on behalf of Bajaj Capital Investment Centre Limited, Bajaj House, 97 Nehru Place, New Delhi - 110019, and Printed at Sundeep press C-105/2, Naraina, Industrial Area Phase - , New Delhi - 110028, and Published at Bajaj House,97 Nehru Place, New Delhi - 110019, Editor-Rajiv Wadehra (CIN: U0000DL1988PLC039417))