Be it a child plan, a unit-linked insurance plan or a traditional money-back plan, you can select one that best suits your requirement and goal.
Mid-life crisis is a phase in everybody’s life wherein expectations collide with reality. On an average, satisfaction levels in terms of emotions and finances are high among people when they are young; this starts dwindling in the early 30s and starts bottoming out between the mid-40s and 50s. This is the time when an individual strongly questions his/her life journey -emotionally, socially as well as financially. And such an analysis, if not in line with one’s expectations can lead to mental stress and frivolous splurges.
While the emotional and the social anxieties can be dealt by talking out to a trusted friend, family member or counselor, one can take stock of the financial uncertainties well in advance. Responsibilities and ambitions like planning for children’s future, education, purchasing the dream house, dream car, health and wellness expenses, travel and lifestyle related spends are some of the things that majorly absorb one’s money.
Evolving lifestyle and spending habits owing to the availability of credit cards and affordable loans lead to the accumulation of debt. Thereby, an age that was earlier imagined as a phase of exploration and reinvention increasingly becomes an age of emotional and financial strain.
However, this situation can be easily altered with the right foresight, taking pre-emptive steps and with disciplined financial planning. It is important for people to take cognizance of the expenses that come with age, much earlier in their lives. This means long-term, goal-oriented, financial planning.
Here are a few worries which usually cause anxiety and add to the midlife crisis; and how an appropriate life insurance solution can help manage them better.
Anxiety 1: Would I be able to protect my child’s future financially?
The thought of providing world-class education while beating the sharply rising cost of education can really give you chills. We are aware that taking inflation into account, a 2-year MBA course at an elite institution that costs nearly Rs 6 lakh today, would bloat somewhere around Rs 40 lakh after 20 years. But the good news is that there are several insurance plans which are especially tailor-made to meet the future financial needs of your child.
Be it a child plan, a unit-linked insurance plan or a traditional money-back plan, you can select one that best suits your requirement and goal. Here, with disciplined periodic payments you can accumulate a corpus for your child’s future. The best part is, in case something happens to you before the maturity of the policy, the pending premiums get waived off ensuring that the policy continues, and your child’s dreams are secured.
Anxiety 2: Splurging too much and not thinking of retirement?
An ideal retirement should mean financial freedom, no more responsibilities and living your life as you wish. This brings us to the crucial question, “How much money would you essentially need post-retirement? Would you be having enough?” This can certainly cause anxiety. The solution is to map your current lifestyle, monthly expenses, and other expenses, consider the inflation rate and then calculate the sum you might need post-retirement. Life insurance can be used for retirement planning in several ways.
You can choose products that would offer capital preservation and help in generating regular income to meet your post-retirement needs, while offering a life cover. A whole life insurance savings plan or a guaranteed return plan, are such policies which will not only offer protection in case of untimely death but will also offer regular income or create a lump sum corpus to help generate income post retirement. Therefore, with timely savings, you will neither have to compromise on your present lifestyle nor your future.
Anxiety 3: Finances for medical emergencies?
This anxiety strikes when you see a friend or a relative succumbing to chronic diseases owing to unhealthy and stressful lifestyles. Stories of rising incidences of life-threatening diseases, inflation, cost of treatment, add to your crisis. You can beat this worry by opting for critical illness policies or riders which offer cash pay-outs to policyholders on mere diagnosis of acute diseases like cancer, heart attack or multiple organ failure.
These plans offer you high cover at low premiums with lump sum pay-outs. They not only act as your income replacement but also provide aid in managing expenditures like money spent on hospital visits, doctor’s fee, house rent, among others.
Anxiety 4: What if I lose my job in the 40s?
Life is certainly full of uncertainties, but meticulous financial planning and a calm mind can help you overcome any such untoward situation. Generally, people insure their health, home, and assets but tend to ignore their source of income. There can be several eventualities in life which can lead to loss of income like job loss owing to economic slowdown, health issue, partial or permanent disability due to an accident among others.
There are life insurance policies which secure your income and guarantee monthly payouts for a specified duration during job loss. Also, opting for life insurance covers like guaranteed savings plans or riders like personal accident and waiver of premium are equipped to financially assist in case there is a job loss.
Treat mid-life crisis as a wake-up call. It is the moment to realize that you can embrace the second half of this life and live it fully. Above mentioned are some of the major anxieties which persists during mid-life crisis. Life insurance can be a safe instrument which with its various tailor-made solutions can handle all these uncertainties in a planned manner. Therefore, analyse the reason that makes you anxious, see if you are prepared enough to tackle it, and fill up the gap with an appropriate life insurance solution to celebrate your mid-life worry-free.The author is Chief Distribution Officer, Aditya Birla Sun Life Insurance