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Why You Should You Buy a Term Insurance Plan With the First Pay?

In the last few years, a term insurance plan has gained popularity and is a preferred choice of the individuals.

In these tough times of the global pandemic, we have realized that anything can happen at any point in time. And surely uncertainties do not come with prior notice. Therefore, the family must be secured specifically in terms of finances.

Imagine the loss of an individual who was the only breadwinner of the family. How tough it would be for the family to cope up? The loss of an earning member of the family is not only disheartening emotionally or mentally but on a larger picture is more challenging financially.

Therefore, considering the time we are living in today, better late than never and buy the term insurance policy. You can use the term insurance premium calculator online that will enable you to calculate the coverage sum necessary as per the requirement.

 A term plan offers death benefit when the policyholder passes away during the term plan. In case you are looking forward to a plan that provides financial stability and security to your family members even if tomorrow you are not there buy a term insurance plan.

Why Buy a Term Plan When You Have Just Started?

Now, that you are done with pursuing your education and have also bagged your first job! Well, this is one feeling, which cannot be described in words.

The feeling of finally becoming financially independent and using your hard-earned money to achieve and accomplish all your big dreams. It is rightly said until one starts earning a livelihood, one understands the value of money even more.

Your first salary and your unending plans, the plans can go and on, however, why not buy term insurance plan?

Sounds unusual right? But on a long-term perspective, this could be the best and the smartest thing to do and achieve the financial objectives.

Listed below are some reasons that would make you understand to buy term insurance plan with the first salary:

  • Secure the Future

    When somebody is the earning member of the family, responsibilities do come along regardless of whether you are married or not. If you are married you have a wife and children to look after and if unmarried so you have parents that have to be taken care. Now, you cannot run away from these responsibilities and obligations. With the term plan, you can plan the future accordingly. On the off chance, if the policyholder passes away, the payment from the insurance provider assures that your family need not face any sort of financial hardships. Buy the term insurance and secure the future of the family as any adversity will not come with prior information. On the premise of your age, lifestyle, policy term, etc. the term insurance premium will be calculated.

  • Financial Stability

    The prime reason for buying any sort of insurance policy is financial stability. The loss of the earning member of the family specifically the breadwinner of the family can easily turn the fate of the family upside down. Under such unfortunate circumstances, managing daily expenses become extremely tough and distressing. A term plan provides sum assured at the time of demise that helps the family to recover financially and not worry about any of the financial obligations and meet the day to day expenses as well. The term insurance premium is generally by the different term insurance companies on various risk factors that mostly reflects the lifestyle of an individual.

  • Financial Discipline

    There is no right time to imbibe a good habit. The earlier you initiate a good habit the better it will be. Buy a term plan and take the first step towards financial discipline as it will help you to take the investment path with your first salary, which is already special to you and you can make the best out of the first salary itself. When initiating early, one can easily be insured for a long-term and with the health condition and your age, the term insurance premiums will be comparatively low. Create a healthy habit of managing your finances efficiently and buy a term plan that suits and fulfils your requirements and pocket as well. The early one buys the term plan the lower will be the premium for the decades to come.

  • Cost-effective

    A term insurance plan is one of the easiest and cost-effective plans that can be purchased. This is one, which ideally does not mix insurance and investment and this makes it the ideal way to shield the family in case the breadwinner passes away. Unlike a ULIP or any other endowment plan, term plans are the easiest to comprehend. All you need to do is pay the premium time to time and get a life cover. Anyone falling between the age of 18-65 years can easily buy a term insurance plan. It is to be noted the early you buy the term plan the less premium sum you would end up paying and that makes it even more affordable when you have just started earning.

  • Tax Planning

    When you become an earning member it is time that you also need to think about the taxes as well. It will be for the first time that you will be filing taxes and pay a part of your income. Well, a term plan is a tax exempted and you can surely enjoy this benefit. You can avail up to Rs 1.5lakh tax exemption within Section 80C of the Income Tax Act. Likewise, the death benefit that will be paid to the nominee is tax-free under Section 10 (10D).

Wrapping It Up

Invest in the best term insurance policy with your first salary. Why not invest in something so that one day you can pat yourself on the back? Buy a term insurance plan and it will give you a sense of satisfaction wherein you need not worry about the financial future of the family.

Extra security probably won't be an instinctual buy with your first salary; however, these convincing reasons may persuade you that it might be a beneficial one. Buy a term insurance plan as early as possible, pay lower term insurance premiums and enjoy the tax benefits while additionally guaranteeing that your family's life objectives are met. For quite a long time to come, you'll affectionately recollect the critical thing you did with a piece of your first salary!

Written By: PolicyBazaar - Updated: 16 November 2020
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