Here we compare two of the options stated above, ELSS and ULIPS. Two tax savings options, which have different objectives.
ULIPS at a glance:
ULIPs offer tax benefits at the time of investment as well as on maturity. Tax Benefit on investment - money invested in ULIP can be claimed as a deduction under section 80C (life insurance) or 80CCC (pension). A maximum of Rs 1,50,000 is allowed under section 80C/ 80CCC.
Insurance is a critical component in sound financial planning. However, it is not to be confused or combined with investment objectives - something that conflicted advisors and insurance agents often push unsuspecting clients to buy into - else the result is financially inefficient, like the Unit Linked Insurance Plans (ULIPs).