Reasons to Buy Term Insurance from Your First Salary

You have just stepped into the corporate world after completing your education, it would be an adventurous ride for you with great learning opportunities ahead. Now that, when you have got your first income, you must have got many bigger plans for using it in order to achieve all your long term goals in life. You may want to gift someone special, save money for your future or party out with friends, it could be anything. However, there is another thing that you may think about------investing in a term insurance plan. It might seem to be pretty unusual for you but keep on reading to know why it may be a wise thing to do in order to achieve your and your family’s goals.

1. Huge Cover, Lower Premium

The great thing about purchasing a term insurance plan early in life is the benefit of cost to you. You are required to pay an economical amount and get a significant life insurance cover. It is due to the fact that you have age, limited liabilities and good health on your side. The best part amongst all is, you are required to pay the same lower premium amount throughout your term.

2. Tax Planning

Now, when you have started earning, you are required to think about paying taxes as well. You would probably be filing for the tax for the very first time and by paying some of your income as premium in a term plan, you can lessen your tax liabilities. The tax benefit can be availed by you up to Rs 1.5 Lakh from your taxable income as per section 80C of the Income Tax Act.

3. Safeguards Your Future

When a person is an earning member, responsibilities come along with it irrespective of the fact that you are married or single. In case, you are married then you have to look after your spouse and children and if unmarried then you need to take care of your aged parents. By buying a term insurance plan, you can plan your future accordingly. In case of the untimely demise of an insured, your family would receive financial support from the insurance provider to meet with any kind of financial hardships.

4. Financial Discipline

It is never late to start inculcating a good habit, especially when we talk about your finances. The earlier you would start, the sooner you would receive financial independence. By purchasing a term plan with your first salary, you can begin by taking the first step. By beginning early, you can stay insured for a longer time period, and your general good health and lower age would also lead to lower premium amount.

5. Cost Effective

A term insurance plan is the easiest and cost-effective plan that can be bought. It ideally does not combine insurance and investment and makes it the optimum way to protect the family if the sole bread earner dies untimely. Not similar to endowment or any other ULIP plan, a term insurance plan is easiest to comprehend. All you are required to do is pay a premium periodically and get a life insurance cover. Any person who lies in the age group of 18 to 65 years can easily purchase a term insurance plan. It is also said that the earlier you go for a term plan, the lesser premium amount you have to pay, which makes it even more affordable.