Why Should You Invest in Term Insurance Before You Turn 40?

Your family is an essential part of your life. Everything that you have built over the years is for them to have a fulfilling and stable life. However, by the time you are 40 years old, there may be responsibilities other than keeping up with the requirements of your family. For example, your child might be going for higher education which costs heavily, and you might also have your old parents to take care of.

This is also the age when people start to experience health-related problems. At this age, you might have a stable job, a car, and a house, too, but there is always a thought about the financial stability of your family when you are not there. The mere thought of your family being in a financial crisis when you are not there is scary. Thus, having a pure term insurance plan that can take care of the finances of your family in case of your untimely demise is crucial.

5 Reasons Term Insurance Investment Before 40 is the Right Decision

Here are five reasons why term life insurance investment before you turn 40 is the right decision:

• Larger Cover At A Lesser Premium

When you purchase a term insurance policy before the age of 40, you tend to get higher coverage at lower costs. With age, the term plan investment gets costlier. Hence, if you are the sole breadwinner of your family, getting a term insurance plan early is important for you. It will give your family the financial protection they need if an unfortunate event takes place.

The earning family member must get a term insurance policy that offers a cover of approximately 20 times the yearly income if they are under 40. They can get a cover of 10-20 times their yearly income if they are above 40. And if you are more than 50 years old, getting a cover equal to 5-10 times your annual income is advisable.

• Provides A Financial Safety Net

Purchasing a term policy is essential if you are the only earning member of your family. For example, you might have availed of a car loan or home loan, or you may have other financial obligations. In case of your unfortunate demise, the responsibility for payment of the loan will fall on the shoulders of your family.

Thus, with a term insurance policy, your family can pay off the loan and also fulfil other financial obligations with the claim amount that they will receive. Also, you can choose add-on covers with your policy so that you can maximise the coverage of your policy. For example, with Tata AIA term insurance, you can choose add-on covers like accidental death, terminal and critical illness, etc.

• Buying Early Means Lesser Premium

You might be in the pink of your health before you turn 40. Diseases like thyroid, hypertension, and diabetes might not have impacted you. So, if you buy an online term insurance plan at this stage, your premiums will be lower. However, as you grow older, the premiums start to rise. Therefore, buying a term insurance policy early is the right decision. Also, during the tenure of the policy, the premium amount will remain the same.

• Avail Tax Benefits

Saving income tax is a priority for everyone, and the premiums that you pay towards a term insurance investment are one of the best tax-saving options that you can choose. In addition, you can avail of deductions u/s 80C. Also, the death benefit that your family will receive will be exempt from taxes as per Section 10(10D).

• The Term Plan By Your Employer May Not Offer Enough Coverage

Many employers offer term plans to employees as a part of the employee benefits, but these term insurance plans end as soon as you switch jobs. Hence, relying solely on the term plan provided by your employer might not be the right decision. Thus, you must get a term insurance plan as early as possible so that it is affordable and offers you higher coverage.

Conclusion

Turning 40 can bring a lot of changes in our lives, and while we wish that everything stays well, there is always an uncertainty that looms. So, buying a term insurance plan becomes the right decision as it gives you the satisfaction that your family is financially secure if anything were to happen to you. Thus, buying a term insurance policy is not just buying financial protection for your family; it also means getting peace of mind for yourself.