Tips to Choose the Best Investment In UAE
Whether you take endowment or unit-linked or annuity, there are a plethora of polar opposite UAE investment options for any investor in the UAE. (so forget about compromising with your desires, at least) On the same note, carefully choosing your UAE investment option holds utmost importance since you will be putting a sizeable amount of your savings into it, and of course, you want it to be safe and, even more, be profitable. Given below are some tips you can keep in mind when preparing to pick the best investment plan in the UAE:
Identify Your Goals
The very first step to picking the best investment plan for yourself is identifying your goals. Further expanding, what do you want from your UAE investment options? What financial goals are you seeking to fulfil using your investment returns? Is it retirement corpus that you need, your child’s education, or saving to buy a new house? Your financial goals can prodigiously impact the UAE investment plan you choose to invest in UAE.
Analyse Your Risk Portfolio
The level of risk you can afford to take at any given point in your life will be a deciding factor for the investment plans you pick. For example, if you can take higher risks, you may be able to invest in plans that offer better returns but with an equally high-risk portfolio. Therefore, see how much risk you can afford to take currently and then choose the best UAE investment plan for you.
Check Your Timeline
Some investment plans start paying off returns almost immediately or only after a short duration. In contrast, others lock up your invested amount for a longer duration and pay returns after the end of that duration, for example, deferred annuity plans. So, if you have 10-20 years before you retire, you can afford to invest in investment plans like deferred annuity plans. On the other hand, if you are about to retire soon, investing in short-term investment plans is surely a better idea.
Create Diverse Portfolio
Instead of investing all your savings in a singular plan, creating a diverse investment portfolio is smarter. As they say, don’t put all your eggs in one basket, remember the old saying? Therefore, try out a few different options and see which one works out the best for you and meets your desires perfectly. Over and above, check the returns you yield with each option and examine the level of risk you have to take with each investment option in UAE.
Revisit Investment Plans Time-to-Time
The UAE investment plan that suits you the best today may not always stay the best investment plan for you. This is because your investment needs may change over time which may, in turn, change the best investment plan in the UAE for you as well. Therefore, keep revisiting and recalculating your investment needs to handle your UAE investment options better.
Keep an Eye Out for New Options
When you recalculate your investment needs, it may also serve you well to see if any new investment plans have come out. This is because there is well enough chance that your insurance provider may have launched investment plans with better returns and an easy-to-handle investment portfolio, and you surely don’t want to miss on that. Therefore, keep track of these updates not to miss out on additional profit.
Just ‘Investment’ or ‘Investment & Insurance’?
Most UAE investment plans come in combination with term insurance plans. So, if your needs are limited to life insurance only, consider buying a term insurance plan instead of an insurance-cum-investment plan. However, if you want to have life insurance in the background and want to take some risk to gain better profit, unit-linked insurance plans may be perfect for you. Likewise, examine your need in this regard to ensure that you have the right plan on hand.
Things to Consider Before Choosing Investment Plans
Your investment portfolio is not the only thing you need to consider when buying an investment plan in the UAE. To pick out the best UAE investment plan for you, you should also keep the following factors in kind before making the right decision:
Value of the Option:
The value that any investment plan holds at the moment should be of utmost importance to you as an investor. For example, if you have a unit-linked plan, you will have complete freedom of choosing your UAE investment option from the available mandate of the insurance company. On the other hand, if you choose to invest in equity, find out their current valuation before making a final decision. The same goes for other UAE investment options as well.
Check the total savings you have and decide what part of it can you afford to invest. Deciding on the amount that you want to invest in is a critical part of your investment strategy because it may not be a good idea to invest all your savings at once. Rather, consider dividing it into parts – one to keep in a savings account as liquid funds for emergencies and the other to invest in investment plans. Since UAE investment plans lock your money for a certain duration, it is best to divide your funds as per your needs.
Your Current Financial Position:
Calculating where you stand financially is essential before picking a UAE investment plan. Answer some questions in your head before making a head-on decision. Can you afford to take the risk? Is it best to pick a safer investment plan? Do you have kids for whom you need to save? Do you have any outstanding loans like education loans? Figuring out your financial position is a must you can’t do without.
Reasons to Invest:
Your investment goals must be vividly apparent right from the beginning since it is a huge factor that helps in choosing your UAE investment plan and option. For example, if your goal is to build a corpus for retirement, investing in a long-term investment plan will be a good idea. However, if your goal is to build up funds in 5-10 years for your child’s education, you can try short-term investment plans. In a word, proper knowledge of your reason to invest will help you pick the right UAE investment plan.
Risk Level of the Option:
Naturally, you need to consider how much risk a certain investment plan brings in for you. Only after considering the risk associated with the investment and matching that with your affordability you can decide whether you should go with it or not. Nevertheless, if you cannot afford to lose your investment at all, going with something like a fixed deposit account or money back policy is smart.
Calculate how much returns you will need on your investment to achieve your financial goals. Then find a UAE investment plan that meets your requirement ideally. Adding to that, building capital is the primary objective of investing your money in any kind of UAE investment option.
Probable Charges: While UAE investment plans do not come with any additional charges, double-checking everything before you land on one final option doesn’t hurt, right?