When it comes to investment, it would be much better if you start earlier. However, it is a good idea to explore possibilities with your finances while you are in your 20’s. Time is a very carping criteria when it comes to investing. A sum of money available today is worth supplemental than the same amount in the future. This is because the high inflation corrodes the value of money.
As a young individual, you are full of buoyancy, energy, and hope. It is the time when you have probably landed your first job and have only a few responsibilities on the shoulder. At this stage, your life seems carefree, and you are looking forward to its various milestones. You might not want to buy term insurance at this stage of your life.
Yet here, we will discuss few solid reasons why you should think differently. Buying life insurance is one of many wise decisions that will chart your financial future.
If you start a term insurance plan early, the premium you need to pay will be lower.
Getting life insurance plan at early age will help you pay lesser premium than starting at older age. At a younger age you are healthy and have less responsibilities, insurance companies consider these factors while deciding term life insurance premiums.
| Premium of term insurance of ₹1 Crore | |
| Age | Yearly Premium |
| 25 | ₹6,000 |
| 30 | ₹8,000 |
| 35 | ₹10,000 |
| 40 | ₹15,000 |
As the premium amount is locked for life, you pay much less in total.
Once you buy a term insurance policy, the premium amount is locked for a lifetime, i.e., it remains the same throughout the policy. Hence, purchasing an insurance policy at an early stage means saving an enormous amount of money over a period of time.
Your family and dependents get covered earlier on.
Waiting too long to get the term insurance means you are leaving your family vulnerable that if you die early, they would have to face financial hardship. Even if you are not married, and if your parents are dependent on you, how will they manage the expenses? If you have any loan to pay, your family members will have to pay for it. This might turn to be the stressful situation for your parents. Thus, buying term life insurance early on means you do not have to worry about it anymore.
And lastly here below mentioned are the 3 tax benefits you enjoy from the term plan.
Section 80C: You can claim a tax deduction for the premium amount that you pay for the policy under this section. It is the most significant tax deduction pool where you can claim a deduction of up to Rs 1.5 for certain investments and purchases.
Section 80D: Under this section, you can claim a deduction of up to RS 25,000. This exemption is allowed on the premium paid towards the health-related coverage.
Section 10 (10D): If the policyholder dies, the nominee can claim this tax benefit while claiming the sum assured. The entire amount is completely free from taxes.
