How Does Your Income Affect the Decision to Buy a Term Plan

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There are many health issues that people face as they go through life. More often than not, because most 9 to 5 jobs make our lives quite sedentary, the chances of meeting a lifestyle disease or contracting critical illness increase. To protect yourself, your partner, and family, a term plan is exactly what you need. Moreover, buying a term plan as soon as possible is vital, as your income plays a significant role here.

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The moment you start earning, you will be looking to save every penny you earn, and term plan will help you make tax-saving benefits. Ideally, when you’re making more money, it is advisable to go ahead to understand what is term insurance and calculate your premium with an insurance calculator. You can protect yourself and your loved ones while saving tax on your income by choosing a term plan. 

Why should you buy a term plan sooner?

Buying terms plans has become a crucial part of every individual’s life. The sooner they are bought, the better it is for everyone. These plans are precisely the protective blanket that could cover you and your family when you need it the most. 

All you need is an insurance calculator to calculate your premium, and you can buy the plan that suits your needs the most. While there is no right time to buy a term plan, the ideal would always be sooner rather than later. However, buying a term plan at a young age is not only about getting protection for your family, but it also offers various other benefits.

  1. Premium increases as you get older
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One of the most significant advantages of applying for a term plan at an early age is that you don’t have to face increasing premiums as you get older. Usually, people tend to be fitter and healthier at a younger age, which means that the premium for a term plan will also be lesser. 

You can calculate your premium using an insurance calculator, and buy a term plan at the earliest. It is best not to wait for a couple of years, because if you would contract any lifestyle disease, then the premium you’ve to pay would be more than what you pay now.

  1. Golden opportunity for tax saving

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If you are already working, you know how important it is to be saving tax, filing returns on time to get your TDS refund at the earliest. The premiums that you pay for your term plan have tax benefits under various sections. You can save a certain amount, which you can calculate using an insurance calculator, from being deducted from your taxable income. 

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By using an insurance calculator, you can keep a tab of the premiums you pay towards your term plan. With respect to the Income Tax Act, under Section 80(C),you are allowed tax benefits up to Rs. 1,50,000. Under Section 10(10D), you can also claim benefits that your loved ones receive. However, you have to ensure that your annual premium is less than 10% of the sum that you’ve been assured of benefits under the latter section. 

  1. Dependents need that protection sooner

Usually, there are always some loved ones in our lives, like our partner or our parents, who are dependent individuals. If you contribute to your household’s income, then your absence can cause tremendous financial strain to the entire family. A term plan can help you avoid this situation and protect your family. 

Using a term insurance calculator, you can find out everything, like the premium you have to pay, the number of years to pay, and sum assured that you could choose for the plan. In other words, using a life insurance calculator will help you calculate how much premium you need to pay to secure your life and that of your dependents. 

  1. Lower risk of health issues
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The younger you are, the more are the chances of not having critical illnesses or facing severe health issues. This helps in opting for a term plan at very low premiums. Further, you can also ensure that you are paying premiums in your earning years and can look back to this term plan if you ever need it for emergencies in your future. These plans are the best way to protect yourself at the right age while also helping you live a stress-free life when you retire. 

While you are young and have your prime earning years ahead of you, it is best to calculate your premium using a life insurance calculator and opt for an insurance plan at the earliest. There is no specific right time to buy a term plan to protect yourself and your family. The earlier you do it, the better it will be for everyone.