Why Buying a Term Plan in the 20s Not Considered Early?

It is said, ‘it is never too early or too late to buy a term insurance policy.’ Read on to know why the 20s is an ideal time to invest in a term plan.Nowadays, youngsters are well informed, smarter, and financially wiser than they were a couple of decades ago. They realise their responsibilities and plan their finances well in advance. And an important step towards financial planning is buying a term insurance plan to secure the financial future of the family members.A term insurance policy is one of the most affordable and most straightforward forms of life insurance that provides a death benefit to the family members in case of your untimely demise. Many experts recommend buying a term plan as early as possible. Why, you may ask? Read on to know why it is better to buy a policy in your 20s.

• When you are young, the premium is affordable When you are in your 20s, you may be all hale and hearty, and you can buy a term plan with highcoverage at an affordable premium. Furthermore, the premium amount remains fixed throughout the policy term. Hence, it is advisable to purchase term insurance cover at an early age so that you can save a significant amount in the long run.
• Easy to buy Today, with insurance companies offering online services buying a term plan is easier than ever before. You can easily compare the different plans from multiple insurance providers in terms of features, coverage offered, premium amount, etc., and make an informed buying choice.Additionally, there are many online tools at your disposal, like the eligibility calculator, the premium calculator that allows you to choose the right plan based on your income, age, and sum assured. Thus, you can buy a policy to suit your specific need with just a click of a button.
• You get insurance protection for a longer period When you buy a term plan in your 20s, you can leverage your age and purchase a long-term policy and stay protected for a more extended period. You can choose a policy for 20-25 years and be assured that you and your family members remain financially secured by paying a nominal premium.
• Dependents financial needs will be taken care of When you are in your 20s, your family members may not be financially dependent on you. But, if you are the only breadwinner of the family, you must buy a term plan to secure their future. In the event of your unfortunate demise, the dependents can use the death benefit to pay for their living expenses. Thus, a term plan helps you to ensure the financial security of your family.
• Tax benefits Apart from safeguarding your family from the uncertainties of life, buying a term insurance plan at an early age allows you to save a significant amount every year through tax benefit. The premium you pay for the policy is eligible for tax benefit under Section 80C of the Indian Income Tax Act. You can save up to Rs. 1.5 lakhs in a financial year.

Final Word While it is impossible to prevent the inevitable, i.e., death, you can surely be well prepared to keep your family protected from facing any financial hardship in your absence.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.