As far as liquidity is concerned, you can withdraw up to half the corpus accumulated in PPF starting from the seventh investment year.
In the case of equity fund investments also , you can withdraw the corpus after one year with no tax incidence or exit load.
The catch here is that if you are using systematic investment plans (SIPs), you will have to wait for all the SIPs to complete one year.
Debt funds are exempt from tax after three years of investments.
If the conclusion is so clear, why do so many people still buy complicated insurance products, and why do the agents keep selling them?
The second question is easier to answer: the agents get a much higher commission for complicated insurance products than for term plans.
Today, a traditional insurance product, whether term or endowment, typically earn agents up to 30 per cent of the first year premium, seven-eight per cent of the second year premium and four-five per cent of the premium during the rest of the policy term.
But agents sell investment plans more because the premium amount is far higher in non-term plans than in term plans and, therefore, so is the agent's commission. (Online term plans fetch agents six per cent only in the first year.)