LIC’s New Pension Plus: Know the options of investment funds to select the best suited one

LIC’s New Pension Plus: Know the options of investment funds to select the best suited one

Like the NPS, LIC’s New Pension Plus (NPP) also has different investment funds, from which a policyholder has to choose the one that would best suit him/her.

Like the National Pension System (NPS), the New Pension Plus (NPP) of the Life Insurance Corporation (LIC) of India also has different investment funds, from which a policyholder has to choose the one that would best suit him/her as per his/her objectives and risk-taking appetite and capacity.

Following are the the different investment funds, their objectives and risks associated:

Pension Bond Fund

With 60-100 per cent investments in G-Sec / Govt Guaranteed Securities / Corporate Debts, 0-40 per cent in short-term investments such as money market instruments and Nil investment in Listed Equity Shares, the Pension Bond Fund is a low-risk fund.
So, if you can’t take investment risks, you may choose this fund that aims to accumulate income through investment in fixed income securities in a relatively safe and less volatile investment way.

Pension Secured Fund

With 50-90 per cent investments in G-Sec / Govt Guaranteed Securities / Corporate Debt, 0-40 per cent in short-term investments such as money market instruments and 10-50 per cent investments in Listed Equity Shares, the Pension Secured Fund provides you an investment option with lower to medium risks. So, if you can take moderate risks, you may choose this fund that aims to provide steady income through investments in both equities and fixed income securities.

Pension Balanced Fund

With 30-70 per cent investments in G-Sec / Govt Guaranteed Securities / Corporate Debt, 0-40 per cent in short-term investments such as money market instruments and 30-70 per cent investments in Listed Equity Shares, the Pension Balanced Fund provides you an investment option with medium risk.
So, if you are not very risk-averse, you may choose this fund that aims to provide balanced income and growth through similar proportion investment in both equities and fixed income securities.

Pension Growth Fund

With 0-60 per cent investments in G-Sec / Govt Guaranteed Securities / Corporate Debt, 0-40 per cent in short-term investments such as money market instruments and 40-100 per cent investments in Listed Equity Shares, the Pension Growth Fund is a high risk option.
So, if you are a risk taker investor, you may choose this fund that aims to provide long-term capital growth through investment primarily in equities.

Pension Discontinued Fund

This is a unique investment fund option that shall be a segregated Unit Fund and shall comprise of all the Discontinued Policy Funds of all the policies offered under the Unit Linked Pension products.
With 20-100 per cent investments in G-Sec / Govt Guaranteed Securities and 0-80 per cent in short-term investments such as money market instruments and Nil investment in Listed Equity Shares, this option also looks a very safe one, which risk-averse investors may choose to accumulate their pension corpus.