Life insurance policy secures the future of the family financially even after the death of the primary bread earner. Here are a few facts that would help you to understand the changing needs of life insurance at different stages of life.
When you have just started your job at the age of 21, you would not need a life insurance plan unless you have dependents. However, having life insurance would secure you financially from situations such as personal accident leading to permanent disability. Other than this, buying life insurance at a young age can be advantageous in terms of paying low premiums.
Let’s understand the changing needs of life insurance at different stages of life in a better way.
Life insurance at the early stage
At the time when you are in your first job, the primary objective of buying a life insurance plan would be to save taxes. At this stage of life, when you are at the start of your career, your liabilities are less, and the premiums paid against the life insurance plans are also less. The premiums paid for the life insurance plans are directly proportional to your age and your liabilities. At this age, the insurance company considers you to be healthy, fit with long life, and no dependents. So, they offer you life insurance plans with a very less premium amount.
Life insurance when you have started a family
Soon when you reach the age of 30-35 and have a family, your responsibilities increase. You have multiple loans at your name, which requires a good financial backup plan. Also, if you are the primary and the only breadwinner of the family, your situation is even more critical as your entire family is dependent on you.
In case anything happens to you, the whole family suffers from financial distress. So, having a life insurance plan at this stage is imperative so that the family has a source of income even after your demise. The premium paid towards life insurance plans is also high during this stage. There are multiple plans such as accidental death cover, permanent disability cover, income replacement offer, which one can buy to ensure financial protection for the family.
Life insurance when you have reached the 40s
During this stage, you have either paid off your loans or are still paying your EMIs. At this stage, you have added expenses of paying for your child’s higher education which is extremely high. Even if you have invested adequately to have a smooth standard of living in your future, still a life insurance policy is a must during this age. One of the options is to take a whole life insurance that would help with lifelong coverage.
Life insurance at the age of 50 years
Here is the stage when you would be looking for a comfortable retirement life. This is the time when your responsibilities are over, and your primary concern would be securing your future and health. A life insurance policy with a critical illness plan keeps you independent and secure even your retirement days. This kind of life insurance policy includes a waiver for all future payments and lump sum payout in case of specified critical illness.
A life insurance policy can be a financial cushion at all stages of life and even after the death of the insured. It gives monetary relief to the family members, thereby assuring a secure and stress-free life.