Buying life insurance is a crucial decision as it is directly connected to the financial security of your family and you
Life insurance gives you the freedom to chase your dreams, knowing that the immediate and long term financial future of your family is secure. Hence you need to buy a policy which is in line with your financial objectives. This helps your prepare for life’s various milestones and offers security in the face of uncertainties.
The earlier the better
It is beneficial to buy life insurance when you are young since the premium amounts are lower. Depending on the plan you choose, as you start early it also gives you more time to build a sizable corpus which can then be used for your children’s education or marriage or post-retirement.
There is no cap on the number of policies you can buy. Depending on your changing requirements, you can keep adding insurance policies at different stages in life. However, while doing this, make sure you don’t lose sight of your objectives and understand the underlying benefits of each policy.
Integral part of your financial plan
Life insurance should be an integral part of your financial planning, especially since it has longstanding and far-reaching benefits. By paying premium amounts at specified intervals, you end up building a corpus of funds over a period of time. It is this money that protects your family financially and secures them in the face of uncertainties.
Once you’ve bought the policy, you then have to service it by paying the premium regularly. Not doing so can result in the policy lapsing and you losing all the benefits that came with the policy.
There are a number of policies available in the market. You should not buy for tax benefits but a policy that suits your needs.
What purpose does insurance serve
If you are an earning member, and more so one having dependents, it is essential that you buy life insurance. You should choose an insurance policy on the basis of your current and projected expenses. Should anything untoward happen to you, the insurance amount will help your dependents tide over a financial crisis. Alternatively, you could use the amount during your lifetime too.
Buying life insurance is a crucial decision as it is directly connected to the financial security of your family and you. So make sure you start early and reap the benefits in the long term.
Sabyasachi Paul has been associated with equity research and advisory on equity markets in India for over 9 years & currently heads the equity research desk of Eastern Financiers Ltd, Kolkata. He also manages a portfolio on the online platform Kristal. Find link to the strategy named ‘The Tortoise’