Moneycontrol
Nov 02, 2017 02:28 PM IST | Source: Moneycontrol.com

A fraction of your monthly fuel bill of Rs 5,000 can buy financial security for your family

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After years of hard work, you managed to save enough to make the down payment for that dream car, now your prized possession. Owning a vehicle provides a sense of empowerment and greater happiness and freedom to you and your family. You will use it not just to commute to office, but will also carry you and your family to the nearby weekend getaways through those multi-lane highway.

While you enjoy your newfound fun and freedom, your office commute and weekend jaunts could easily mean an outgo of Rs 5,000 on fuel per month. But you don’t mind paying for it. Will you ever think of giving up your car to save money? Definitely not! You will somehow manage to set aside the amount required for refuelling.

But what if one day your family finds itself unable to foot the fuel bill if you are not around to support them? Should they deny themselves the comfort and happiness you promised? Should they give up their pride and compromise on the lifestyle you got them accustomed to? Again, the answer is a most definite ‘no’.

Well, there is a fool-proof solution to secure your family’s financial future lying before you, and that too at one-tenth of your Rs 5,000 monthly fuel bill. All you need is Rs 500 a month as premium to buy a Term Life Insurance cover, or barely a fraction of your monthly spend on fuel, to provide long-term financial security to your family and bring you a peace of mind.

As Susan Lynn Orman, an American author, financial advisor and television host says, “If a child, a spouse, a life partner, or a parent depends on you and your income, you need life insurance.” And the best insurance is a pure Term Life Insurance.

Term insurance is your friend for life that will always step in to protect your family in your absence. If you pay your premium regularly, the insurer will pay the agreed sum assured to your nominee when you are not around.

The icing on the cake is that Term Life insurance will not burn a hole in your pocket. Consider this: A 30-year-old male can purchase a Term Insurance cover of Rs 50 Lakhs for barely Rs 500 a month for a policy term of 40 years. The premium amount remains the same for the entire policy duration.

Buy early, Buy now!

If you have any dependents, the best time to buy Term Insurance is right now! Because premium will increase with each passing year and you leave your family vulnerable and exposed to uncertainties.

For example, for a term cover of Rs 50 lakhs at age 30, for a 30-year term, your annual premium will work out to around Rs 5,200 anually (or Rs 437 per month), while a year later the premium would rise to Rs 5,873. If you delay the purchase by 10 year and bought the policy at age 40, your premium would be Rs 10,800 (Rs 900 per month), or more than double the amount required at age 30.

Smart term Insurance Calculator

Pay according to ability

Insurers provide flexibility on premium payment terms. You can either pay lump-sum or in monthly, quarterly or half-yearly payments. You can choose your payment plan depending on your ability and cash-flow. Your nominee can receive the sum assured either in lump-sum or in agreed instalments.

Buy the safety net, over the Internet

You can buy term insurance online within minutes from the comfort of your home. Just a few clicks and you are home! Upload your details and the policy is issued within days. Online policies often come at a 30-40 percent discount over offline purchase. So, spare a few minutes on your computer for a worry-free life.

Enjoy topping beyond the cover

Some term insurance covers offer additional inbuilt benefits such as terminal illness benefit and waiver of premium benefit in case of disability. You can also enhance your cover by opting for critical illness cover and accident disability cover. These come at a small extra cost.

Secure your family, save on tax

Investing in Term Life insurance comes with tax advantages. Under Section 80C of the Income Tax Act, you can avail the entire Rs 1,50,000 maximum tax deduction available for premium payment for Term Insurance.

With term life insurance, you buy peace of mind, one of the most precious things for you and your family. So, the next time you head for the gas station to fill up, spare a thought for your family’s future. Set aside that Rs 500 from your salary for the Term Insurance cover, and remove all worries.
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