A term plan is an important component of financial planning and it should be purchased at the earliest. Such an insurance plan provides protection to the family in case an unfortunate incident was to occur. It is an assurance that your family will be well looked after in your absence. Your family will not have to go through a difficult phase due to lack of funds if you have invested in a term plan. Many are of the opinion that this plan should be purchased at a later stage in life. However, this is the wrong approach. You need to invest in a term insurance plan as early as possible.
Reasons why a term plan should be bought at an early age
There is no specific age to invest in a term plan. However, but you need to buy one as soon as you start earning. Here are a few reasons that will convince you to buy a term insurance plan at an early age.
- The premium will increase with age
When you are younger, you are healthier and as you get older, there is a higher risk of contracting illnesses and diseases. Hence, when you take the insurance plan at a young age, you can enjoy a lower premium. If you wait for a few years to buy the term plan, the premium will be high because of the risk associated with the same. If you have an illness and then buy a term plan, the insurance company could reject the application altogether or could apply the waiting period on your policy.
- Protect your dependents
If you are contributing to the household, you need to ensure that you provide for the financial security of the family. It does not matter whether you are a man or a woman, you need to understand that your family will have to face certain difficulties in your absence, and in order to avoid the same, you need to buy a term plan at the earliest.
- Live stress–free
The biggest advantage of buying a term plan at a young age is to live your life stress-free. No matter your age, it is not possible to predict your future and when you have invested for the financial security of your loved ones, you can live your life in the best possible manner. You can also increase the sum assured in a term plan at different stages of your life.
- Save tax
Term plans can help you save money. When you pay a premium for the term plan, you are eligible for a deduction under Section 80C. An amount up to INR 1.5 lakh is eligible for tax deduction under this section. In addition, the benefits that your loved ones receive will also be exempt from tax under Section 10 (10) D.
To conclude, there is no specific age to buy term insurance. The sooner you buy term insurance, the better it is for you. A term plan is a very simple life insurance plan, which is available at an affordable rate and provides comprehensive protection. It offers an opportunity to save tax and enjoy life stress-free. Do not delay the purchase of a term plan, because there is no right age or right time for it.