InvestorQ : What is advisable for newly married couples to buy - mutual funds or insurance policies?
krithika Saxena made post

What is advisable for newly married couples to buy - mutual funds or insurance policies?

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priya Shah answered.
3 months ago
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First and foremost, do understand that there is a very distinct difference between “Insurance” and “Investment”. They serve different goals and are never meant to be clubbed together. People often tend to mix them. Insurance policy should not be taken as an investment instrument and vice-versa. A life insurance policy is to be taken for protecting one’s life and compensating for the untimely demise of the policyholder. Life insurance policies are NOT designed to make money or create wealth. For the purpose of creating wealth, one should choose instruments that are designed for that purpose like equity, mutual funds, bonds, debentures, alternative investments, etc.

As far as insurance goes, you should opt for a term insurance policy. If both the spouses are working, you should buy individual terms and keep the other as a nominee. It will also be wise to invest in a health insurance policy over and above what your companies provide you. Medical emergencies are something we can never predict. However, these are expenses we cannot avoid and they tend to balloon which will be disastrous for your financial plans.

As far as the mutual fund goes, it will be very difficult to recommend those randomly as they should be invested in based on your individual financial profile and long term goals. In case you are not confident enough to choose them on your own, it is best to consult a financial advisor for the same. 


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