Why Should You Buy a Term Insurance Plan with Your First Pay

Now, when you have completed your studies and have also got your first job, you have officially stepped into the corporate world and the feeling is indescribable. Becoming financially independent and earning your own money is an unmatched feeling.

Why Should You Buy a Term Insurance Plan with Your First Pay

Got your first salary and feeling confused on how to spend it wisely? Well, why not begin by purchasing a term insurance plan.Seeing things from a larger perspective, purchasing a term insurance plan now at this point in life would prove to be one of your smartest moves in order to achieve all your financial goals.

 Highlighted below are some of the reasons why you should consider buying a term insurance plan with your first salary:

•  Safeguards Your Future

 Responsibilities on the shoulders of an earning individual comes irrespective of the fact whether they are married or unmarried. In case you are a family man, then you have the responsibility to look after your spouse and dependent children and in case you are not married, then also you have to look after your ageing parents. With a term insurance plan, you can secure the future of your family members financially even in your absence.

•  Financial Discipline

To imbibe a good habit in your life, there is never any correct time. The sooner you start with imbibing a good habit in your life, the better it would be. By purchasing a term insurance plan, you can take the primary step on the path of financial discipline as it would help you in starting with the investment habit. Purchasing a term insurance plan early, an individual can stay insured for a long period of time and with the present age and health condition, the premiums payable towards a term plan would be comparatively low.

• Financial Stability

The main reason behind buying any kind of life insurance plan is to ensure financial stability in one’s life. Due to the unfortunate death of the sole breadwinner of the family, the fate of the dependents left behind would drastically turn upside down and it would become extremely difficult for them to manage their daily expenses. However, by purchasing a term insurance plan one can safeguard the future of their family members financially. As due to the unfortunate demise of the policyholder, the appointed nominee receives a complete sum assured from the insurance company.

• Tax Planning

When you start earning, it is the right time for you to start focusing on taxes as well as it would be for the very first time that you would start filing for income tax as a part of your earned income. A term insurance plan is exempted from tax as per section 80C of the Income Tax Act, and one can avail maximum up to Rs. 1.5 Lakh. Moreover, the death benefit received by the appointed nominee is tax exempt as per section 10(10D).

• Cost Effective

A term insurance plan is one of the most cost-effective life insurance plans that one can buy. By purchasing this plan, one can ideally save their family from any kind of financial distress that can occur due to sudden demise of the policyholder. Here in order to receive a continuous life cover, one simply needs to keep paying  premium on time.

At the End

By purchasing a term insurance plan with your first paycheck, you can receive peace of mind and a sense of security, wherein you no longer have to worry about the financial security of your loved ones in your absence.

Also read: Popular Online Term Insurance Plans in India

Why Is It Crucial For Parents To Have A Term Insurance Plan?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.