A term plan does tick all the checkboxes in the list of factors that people consider to get life cover. It offers financial security to the family, is highly affordable, and gives the flexibility to choose a sum assured. All these benefits make it the best financial instrument for investment planning. One can easily use a term plan calculator to get a premium estimate.
However, many people still feel stuck at a common question – What is the right time to buy a term plan?
Although it is a valid question, its answer is easily understandable. It says – the earlier you buy a term plan, the better it will be for you. Many individuals are unaware of the benefits of early investments in term insurance. When you invest in a term plan at a young age after estimating premium using a term plan calculator, you can save money as well. In fact, including term insurance in financial planning at a young age is the sign of a wise investor, the one who knows how to plan for life’s uncertainties at the right time.
Let’s explain why you should buy a term plan at your current age after using a reliable term plan premium calculator.
When You Have Recently Started Your Career
Beginning the new chapter of a working individual in your life does feel good. You make plans to utilize the earnings to fulfil various needs – yours and that of your loved ones. If you have certain financial liabilities at this age, it would be easier to plan your parents’ financial security with a term plan.
Just check an online term plan calculator to get a premium estimate for a certain sum assured, say of Rs. 50 Lakhs or Rs. 1 crore. Enter your personal details and see how the premium varies with age. One of the primary term insurance benefits is that you can get life cover at a low premium when you are young. Having a term plan with an adequate sum assured by your side will work as a financial backing for your family members in case of your untimely demise. It is thus, best to plan for such needs as early as possible in life.
When You Are Married and in Your Late 20s
After marriage, you get many responsibilities – of your spouse, family, work-life, and many others. With these responsibilities comes the need to plan for a safe and secure future for the family members. One way to do this is to set aside a certain amount regularly, which can be used to deal with tough times. However, the inevitable event of death brings sorrow and financial crunch with it.
Investing in a term plan after careful consideration of your needs helps plan for such eventualities. The chosen sum assured acts as an income replacement tool to deal with the absence of a breadwinner. It also serves as a cushion for your loved ones to bank upon for their life goals without facing any constraint.
In other words, by using a term plan calculator at this age and purchasing term insurance, you can opt for sufficient coverage at a premium you can afford.
When You are Married and Have Kids
Having kids in life make it blissful. But people also start to think about how to make their kid’s life enjoyable and prosperous. For that, they start to think about choosing the right school, planning for the education expense, and higher education. In most cases, savings do not suffice to back the financial side of a kid’s educational needs.
Even this aspect of your life can be planned through term insurance. While using an online term plan calculator, you can choose a life cover that can fulfill your kids’ educational goals in your absence. You can also select the return of premium option to plan for getting maturity benefits under term insurance. Use a term plan premium calculator to check how the premium varies with or without the return of premium selection.
You can also maximize tax savings by investing in term insurance as per the existing laws and deduction rules.
Things to Consider While Using A Term Plan Calculator
When you use a term plan premium calculator, you will come across a few parameters that you need to choose carefully –
Life Cover or Sum Assured
It is the amount payable to the policy nominee in case of the untimely demise of the life insured. You need to choose it carefully by carefully assessing your lifestyle, needs, and financial liabilities.
The selection of policy period while using the term plan calculator should be based on your retirement plans. You can choose it till the time you reach the age of 60 or above. The total period is then calculator as per your current age.
Premium Payment Tenure
It can be equal to or less than the policy period. As a policy buyer, you can choose a lesser premium payment tenure while the policy continues till a later time.