One simple question

I was being followed up regularly by a company (where I hold a demat account) for an attractive investment option. When I asked for details, I got to know that ' It is a single premium product' and the returns from the product has been around 16% last year.

One more ULIP sale. I asked them one simple question. How much of the premium would actually be invested in the scheme??. The answer was that regulations on ULIP have changed and the invested amount has actually gone up. I wanted a quantified answer. If  I am say investing 1 lakh rupees into the scheme, for what portion do I get NAV allotted?

The answer was 94000. 

i.e. Out of the 1 lakh , I would invest ......The units allocated would actually be 94,000. Based on past returns , If the fund manager provides 16% returns next year then I would actually get the return of 16% in 94,000. (((6,000 gone somewhere immediately on investing  and my investment actually starts growing form 94,000)))

So, when you are sold any product ask this simple questions.

" How much of my money will actually be invested ??"

Ensure it's somewhere around 100%.  :-) and never club insurance with investment.

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