Living life with optimism is a good way to lead life, and preparing for any unforeseen circumstances beforehand makes life even more stress-free. However, the spectrum of unforeseen events can be wide, and we may not always know the nature of these events.
The least we can do is to be prepared for such events financially. One product that helps you prepare in advance is life insurance. In this blog, let us explore a few consequences that can arise if you don’t invest in a good life insurance policy.
Scenario 1: Leaving your Family under huge Debts
It is possible that you took a few loans in your lifetime to provide for your family. It’s justified to take a few loans but what’s not justified is leaving behind those debts for your family.
Without you, these obligations continue, piling up debt. Without the right life insurance, your family could face not only the grief of loss but also the relentless pursuit by debt collectors. Many Indian generations have faced the problem of a debt trap as their families owe huge sums of money to lenders. It is advisable to opt for a comprehensive life insurance plan that covers death and total and permanent disability so that you can leave a legacy of love, not debt.
Scenario 2: Not Protecting Your Loved Ones After You're Gone
If you are the sole provider for your family, you need to have a plan for them after you’re gone. Imagine the sad setting that already exists which is further exaggerated by lack of funds.
The solution is for you to invest in life insurance. It isn’t for you alone; it’s a wise step to ensure your family’s well-being even in your absence. With life insurance, you can safeguard your family’s future, ensuring continuous support for your child’s education and providing your spouse with financial stability during tough times.
Scenario 3: Overwhelmed by Taxes? Having a Life Insurance Policy could be a Relief!
Purchasing life insurance presents a strategic advantage as it grants you a tax deduction under Section 80C of the Income Tax Act of 1961. The payout you receive upon the policy’s maturity is also tax-free under Section 10(10D).
Nobody wants to pay taxes on their income. By saving your money through the right channels you can save on your taxes today and prepare for your family’s future tomorrow.
Scenario 4: Being Financially Dependent on Your Family in Your Retirement Years
Retirement is often seen as the golden phase of life, and you should enjoy it thoroughly. However, for many people above the age of 60, this period is marked by heavy dependence on their children and other family members, signifying a total loss of financial independence.
To avoid becoming financially reliant on your family in your later years, it’s crucial to plan for your retirement early. This includes investing in a robust life insurance policy that will support you in your golden years.
Consistently investing over time is a wise strategy for retirement savings, allowing your funds to accumulate and grow through compounding interest.
Scenario 5: Delaying Life Insurance Can Cost You
Delaying the purchase of life insurance only leads to higher costs. The best time to buy is when you’re young, healthy, and have a clean family health history, as premiums are more affordable. If you wait until the age of 50 to buy life insurance, the premiums become very expensive and can pinch your pocket.
The benefits of an insurance policy are innumerable and only time can help you understand its importance. But we do hope it’s not too late before you can understand the importance of having a life insurance policy in place.
Concluding thoughts
In summary, India offers a diverse range of life insurance options, including term, unit-linked, and endowment plans. The essential step is choosing a policy that matches your financial situation and goals.
Evaluate your finances, considering debts, expenses, and future needs. Aim for coverage that is 10 to 15 times your annual income and compare quotes from different insurers to find the best rates. This approach will help you secure favourable life insurance terms and ensure that your family is financially protected.
