Before you start off to invest in mutual funds or Ulips, it is very important to analyze what kind of an investor you are and what your goals are.
If you have a family and are in your mid 30s aggressive investment with a high degree of exposure to equities is most sought after. Since, you will be wanting to own at least one property on your name, set aside a considerable amount for your children’s higher education and your daughters marriage as and when the requirements knock on your door step. But if you are single, and are most likely to consume your returns for post-retirement needs and holidaying, then a less risky path is advised. Investing in debt instruments and a comparatively less exposure to equities is advised.
But primary importance should be given to your debts, if any. Try liquidating any of your assets in order to prepay your loan, especially those loan tenures that carry a 15-20 year repayment period as in the case of a home loan. This will considerably reduce your savings pressure.
Try to move your funds out from Fixed Deposits and start investing in monthly income plans of mutual funds, where the equity exposure is limited to 25%. If you do not like taking risks, then its better to consider hybrid funds where in the debt – equity ratio of investment is tailored according to the investor’s needs. If you do not have any dependents, there is no need for you to have any life insurance cover. Instead opt for a comprehensive health insurance cover along side a critical illness cover as well.