A while back, reader Lakshmi wrote to me saying,
My mom is particularly concerned that my brother’s job is non-pensionable and recently she heard about the SBI Life Insurance Pension Fund. Please throw some light on this matter.
I couldn’t write back since I was held up with other work. But Lakshmi soon wrote back with this update:
About my previous questions on finance, I did some work myself. The SBI Life Insurance Plan is just a Unit-Linked Pension Plan and clearly states that the investor should bear the market risk. In short, they are saying that they’ll take our money only to lose it by investing in shares. I’ll go home and call up my aunt who suggested it in the first place.
Brilliant. I repeat my advise: Never ever invest in a financial instrument that you don’t understand. And to understand, all it takes is a little bit of research. That’s how you develop awareness.
Awareness Fridays is my new initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.