What is a One-Time Investment Plan?
A one-time investment plan is an investment strategy in which a substantial volume of money is put into a certain plan for a set period of time all at once. You can invest in a one-time investment plan as an investor if you have a substantial sum of money and are willing to take a big risk. You must choose the best one-time investment plan with high returns so you can get the optimal result from it.
Reasons For Investing in a One-Time Investment Plan
There are several reasons which make a single-time investment plan beneficial. One-time investment plans can be your go-to investment plans due to the fact that you won't have to pay dues at regular intervals. Additionally, here are some of the reasons how this investment plan provides security for your kid's future :
Growth of Capital
Gains through capital market investments are based on the performance of the market. In the near term, stock prices might rise or fall. The money spent on recurrent premiums does not have enough time to react to market circumstances. However, in the long term, the gains tend to cancel out the losses. As a result, one-time investment can help you build your wealth in future in the long run.
Reduced charges
You must settle the related transaction costs each time you engage with multistage investments. However, with a one-time investment plan, you just have to cover the expenses once. As a result, a one-time investment is less expensive. This also removes the prospect of levied charges when paying premiums.
Better Returns
The importance of compounding the benefits of long-term investments cannot be overstated. The dividends gain higher interest each year. Your investments are made for a shorter period when you pay multiple premiums. A one-time investment, on the other hand, commits the entire cash for the duration of the investment. As a result, long-term profits may be higher.
Consequently, if your returns are higher, you can always aid your children financially and ensure that they have a secure financial future. Choosing the best one-time investment plan with high returns can be quite beneficial to you and your family.
Eliminates Policy Lapse Possibility
Once the amount for the one-time investment plan has been paid off, you don't have to be worried about paying dues at regular intervals. The policy with one-time investment is that you have to pay the whole amount collectively at one time. Also, sometimes when the investor is not able to pay the premium in due time, the policy lapses. However, this is not the case with a 1-time investment plan, which makes it a suitable option.
Easy exit withdrawal
At the time of the investment's maturity, you also have the convenience of easily withdrawing the sum. Also, in cases of emergency, you can withdraw the amount when it is needed. Therefore, you don't have to wait for its maturity period to withdraw them. All the best one-time investment plans provide you with the feature of withdrawing amounts as and when necessary.
The Power of Compounding Interest - Grow Your Money Exponentially
Imagine a banyan seed. Planted small, it takes years to become a majestic tree. Compound interest works similarly. It's the interest earned on your initial investment, plus the interest earned on the accumulated interest over time. The earlier you invest, the longer your money has to grow through compounding.
Let's look at an example: Say you invest a one-time sum of ₹1,00,000 for your child's education in a plan offering a 7% annual return (realistic for some investment options in India). If you invest when your child is 5 years old and leave the money untouched until they turn 18 (13 years), the investment could grow to approximately ₹3,43,950! This is due to the power of compounding – your money grows on itself. The longer the investment period, the more dramatic the growth can be.
Investment Options Tailored to Your Needs
One-time investments can be used to explore various investment options in India, depending on your risk tolerance and financial goals. Here are a few popular choices:
- Unit Linked Insurance Plans (ULIPs): These combine insurance with investment, offering life cover and the potential for market-linked returns. Choose a plan with a high investment component to maximize growth for your child's future.
- Public Provident Fund (PPF): A government-backed scheme offering attractive interest rates and tax benefits on investment and maturity amount. It's a low-risk option for steady, long-term growth.
- Sukanya Samriddhi Yojana Account: This government scheme is specifically designed for girl child education. It offers attractive interest rates and tax benefits, making it a great option for a daughter's future.
- Equity Mutual Funds: These professionally managed funds invest in Indian companies. They offer the potential for higher returns but also carry higher risk. Consider this option if you have a longer investment horizon and can tolerate some volatility.
Everyone should have a financial strategy in place to assist their children and families. The recent pandemic has served as a reminder that the future is uncertain. As a result, it is a parent's responsibility to ensure that their children's financial future is safe. So, one-time investment plans can support your loved ones remain financially stable even in unprecedented times.
