Why Youngsters should buy term insurance?

Most youngsters today do not have a clue about financial planning. Not having the faintest idea on how to invest their extra income into something productive, they splurge it on buying unnecessary things. Funds they waste needlessly can come to their aid or their family’s support in the future when appropriately invested. 

Most youngsters are careless in money management. They often make ill-informed financial choices which they regret at the later stages of their lives. The culture of spending more and saving less is hazardous with future virtually unknown. 

It is rather unfortunate that Millenials do not understand the importance of life insurance. Given the erratic lifestyle and volatile environment, anything could happen to anybody even at a young age. Without a financial backup, their whole family could end up in a financial doldrum in the event of their sudden passing away. 

It is the main reason as to why youngster should invest a part of their income into term insurance. While savings on mutual funds and other schemes may help them to build a corpus, term insurance, on the other hand, will come to their family’s rescue by providing a lump-sum monetary benefit in the unfortunate event of their demise during the policy tenure. Additionally, if they purchase term insurance at a young age, they can avail it at a low premium cost. 

Why Should you choose term insurance plan?

1. Life Cover

The main reason as to why you need to choose term insurance plan is that it offers life cover. In the event of your unfortunate demise during the policy period, your nominee will receive the sum insured. It will ensure your family will not go through any financial hardship in your absence.

2. Add on or Riders

Along with the main policy, you can go for additional riders like disability cover or critical illness cover. By paying a nominal additional amount apart from your premium, you can cover these risks.

3. Minimum Investment

When you are starting your term insurance at a young age, you can buy them at a lower premium. There’s a significant difference in terms of premium money when you buy a term insurance policy when you are 25 than 45 years old. It’s never too late to start a term insurance plan for youngsters. The sooner they start, the lesser their premium is going to be as they are considered to have a high life expectancy. 

4. Exponential cover

Compared to the low premium that you pay, the risk covered is exponential. If you start at a young age, you may also get a better sum insured. Also, the term insurance plan offers a much higher sum insured compared to what you invest. 

5. Tax Benefits

You can avail tax deductions up to Rs. 1.5 lakhs under Section 80C of the Income Tax Act, 1961. 

6. Easy Buy option

Gone are the days, where you have to run from pillar to post behind the insurance agents and companies for a policy. With sites like FinCover, you can buy the plan you require within a few minutes with no paperwork. Sites like FinCover offers the customer to compare and choose the term insurance plan from different companies as per your requirements.

Conclusion

Instead of being a spendthrift splurging your money on unnecessary items, it is wise to invest in a term plan that provides long term benefits. As life is uncertain, you should always make arrangements to safeguard your loved ones, even in your absence. And there is no better option than to buy a term insurance policy.