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Look Out For An Endowment Plan To Help You Grow Your Savings

Updated On Feb 03, 2022

Right now, the markets are fragile, and interest rates are at record lows. And you might be wondering how to keep your money safe while still combating inflation. Here's how an endowment plan could assist you in beginning to grow your financial portfolio. An endowment policy is a life insurance policy with a savings component. Endowment policies are frequently set to expire after a specific period of time. As a result, if you're aiming to fulfil financial goals that won't be met once your policy matures, such as paying for your child's tertiary school tuition or investing for retirement, it's very beneficial. 'Wealth Accumulation Plans' is another name for them.

How to Find an Endowment Plan That Will Grow Your Money?

Here are some things to keep in mind with endowment plans:

1. Expect a Recession

Closures have occurred in certain areas, such as travel, tourism, and retail outlets, hurting both business owners and employees. While some may have already been laid off, those of us who have been fortunate enough to keep our jobs should rethink our spending priorities and start saving more to safeguard our financial future. If you have at least 6 to 12 months of emergency savings, you should consider investing in endowment policies. It's a smart idea to put your idle cash to work if you can set aside the funds for the duration of the insurance.

2. Increase Your Financial Assets' Size And Stability

Not only must you preserve money, but you must also safeguard yourself. An endowment plan not only offers you potential revenues but also protects you financially. Some policies provide a death benefit of 101 percent of the single premium in addition to a 100 percent capital return at policy maturity. Furthermore, enrolling is straightforward because there are no medical exams required prior to purchase - entrance is guaranteed. Now you can sit back and watch your savings grow. 

3. In a low-interest rate environment, a tool for saving

The significance of saving is one of the most fundamental principles of financial planning. Unexpected events such as a long-term illness, a retrenchment, or a desire to take a sabbatical to pursue one's aspirations can all be mitigated by having extra funds on hand. While banks pay a low interest rate on cash deposits, there are a range of other savings options that can yield higher returns, particularly in a low-interest rate environment like the one we're in now.

4. Fixed Maturity Period 

The phrase "maturity period" simply refers to how long it takes for your money to grow in value. After the plan matures, you will receive a payout of the premiums you paid, plus any bonuses. Endowment plans have a range of maturity periods, ranging from three to thirty years. Choose a maturity period that permits you to obtain your money when you need it if you're saving for a certain objective. You might choose a maturity period of 15-20 years if you're freshly married and want to invest in an endowment plan to assist pay for your future child's education. For longer-term goals such as retirement, you can specify a maturity period of 30 years.


Endowment insurance policies ensure that you or your beneficiaries will receive a payout whether you survive to the end of the policy's term or die before it does. The full cost of an endowment policy will be refunded to the policyholder or, if the assured dies, to the life insurance policy beneficiary on the "maturity date." This policy does not guarantee bonuses. Endowment insurance, as a result, offers the best combination of guaranteed and non-guaranteed policy benefits.

Also Read: 5 Common Questions Asked About Endowment Plans

Know Why Endowment Plans Are Better Than ULIPs

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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