Buying Term Plans at Young Age - Smart and Wise Decision

 

Financial experts always advise that one should get Term Insurance at a young age as it maximises our security for the future while reducing risks considerably.

But do you know why it's important to get Life Term Insurance at a young age as compared to later in life? Let's find out.

Why Do we need Term Life Insurance?

What many of us don't understand is the fact that having Term life insurance is important to cover our future expenses and take care of our current liabilities.

It secures our loved ones in case you are not there tomorrow and is one of the most affordable form of insurance with maximum benefit when it comes to future planning or death of the life assured.

What if your term insurance plan expires when you are around the age of 55 to 60 years? Would we need to buy an insurance cover again?

Many of us don't buy a term insurance plan early thinking we have still got time. What one must understand is that Term Insurance is most cost effective bought at a younger age. Also, we can always opt for a longer duration of coverage so as to make sure it doesn't expire early.

Also, Term insurance is primarily bought to cover one's existing and future financial liabilities, by the time you reach the age of 55 or 60 these liabilities would have reduced so even if the term cover has expired it would be best advised not to buy it again as it may be expensive especially looking at the fact that the health condition of the individual would have deteriorated.

What is the best way to calculate a persons life insurance need and coverage?

The best way to calculate your life insurance need is by evaluation. Coverage term and amount vary from person to person even if they are of the same age as we look at their liabilities and needs. Hence one needs to calculate his/her Life Insurance coverage amount based on their needs and liability. Some of the key parameters to keep in mind are - current income, future earning potential, current savings, expenditure and inflation.

Do we get returns on term plans?

Unlike other Insurance plans which offers us returns, term plan mostly only offers pure protection and hence provides no returns on survival. So, it's best to get Term Insurance early and have our risk covered and have other Life Insurance plans side by side which offers us good returns on maturity.

Here are some good term Insurance plans by HDFC to consider while planning for your future.

Related Articles

• Term Plans Are Cost Effective If Bought At a Young Age
• Why do I need a Term Insurance Plan?
  
• Kind of deaths not covered in term insurance
• Difference between Term Insurance and Whole Life Insurance
• When is the Best Age to Buy a Term Insurance Plan?
• Comparing term insurance plans with traditional life insurance cover

 

Buy Term Insurance