Here's why considering a life insurance in your 20s is a smart choice

The hectic life we live today comes with concerns as we are accustomed to professional commitments, working long hours, and an erratic schedule for fitness or health. In such scenarios, it is good to consider life insurance to secure your days ahead.

Here's why considering a life insurance in your 20s is a smart choice

With an uncertain and a hectic life today, one can never know and control the situations which arise in the future. However, it is in our own hands to ensure that we are prepared to handle the situation efficiently. One such measure is ensuring that you buy life insurance at an early stage of your life. While hundreds of factors are under consideration that determines life insurance premiums, age is one of the most critical components, and it makes a strong case for buying life insurance as early in life as possible. For starters, buying life insurance at a young age can save you a lot of money. Therefore, even if you don't think you need life insurance right now, be smart and purchase it in your 20s or early 30s. Here are the reasons why:

  1. The first reason for this is simple. The younger you are, the healthier you are, whereas the older you get, the more are the risks of contracting critical illnesses. The lifestyle we lead today gets difficult as we are accustomed to a rigorous professional life, spanning at least 9-10 working hours a day. Therefore, if you purchase a term plan in your 20s/30s  when you are free of any such medical conditions, you can get a plan for a few thousand rupees a year without the risk of an increase in premium down the line. 

  1. Life Insurance ensures protection for your dependent. When you are a bread-earner for your family and you are contributing to the household's income, your absence can cause a huge financial strain on your family. Your dependants- be it your parents, your spouse, or your children – may have to bear the burden of paying off your home or education loans, and even managing day-to-day expenses without your contribution. So, think wisely!

  1. Insurance is a smart way of saving tax. No one wants to let go of their hard-earned money so easily, and saving the bucks today is one of the things that can provide any individual with a joy. Hence, considering this option is one of the best and suggested ways to save tax. It is vital to understand that term plans are the simplest and safest way to help you do that. Let’s break this in two points:

    1.  First of all, the premiums that you pay for your term plan offer tax benefits of up to ₹1,50,000 under section 80(C) of the Income Tax Act. This means up to a maximum limit of ₹1.5 lakh, your premium can be deducted from your taxable income. 

    2. Secondly, the benefits your loved ones receive are also exempt from tax under section 10(10)D, provided your annual premium is less than 10% of the sum assured. 

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But if you are wondering how to choose a viable plan, then consider pondering over how much cover would you need. In this process, it is worth taking assistance from an advisor or merely using a life insurance calculator. Once you’re clear with the idea, think about the affordable budget for the premium along with the number of years you want to be covered. It helps you to balance your options.

The third step in this process would be to scout out your options for buying. Many professional organisations today offer either medical insurance or life insurance as a part of the remuneration package. But if you don’t, you may want to consider buying life insurance through a company as it may benefit you with some discounts.

If you are still concerned about the choices and unsure about the process, try considering an insurance agent to clear the doubts. It is better to clarify before purchasing something for life.

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Make sure you purchase the life insurance policy once you have understood the premium policies and the benefits offered. To be honest, the process has become fairly easy today with highly qualified teams available over a click or merely internet helping you within seconds. However, while you may recognize the need for life insurance in your 20s, you don't want to rush into a buying decision without getting all the facts first. 

After all, time is on your side.

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