4 Reasons To Buy Whole Life Plans When Young
Guaranteed coverage, periodic payouts and tax benefit
Whole life plans from various companies come with multiple payout features. Some offer a substantial amount immediately after the payment term and at the end of the policy term. Some offer yearly survival benefits from the ending of the premium payment term till maturity. Some may assist policyholders map out significant milestone events, while others can supply extra income through the retirement years. There also tax benefits available under sections 80C and 10(10D).
Source of cash and credit
Financial experts advices people to keep six to eight months of the household budget in liquid assets as a safety net in case of sickness, disability, job loss or other emergencies. However, with multiple demands on a person’s income, it can be easier said than done to maintain ready money and still meet retirement and other long-term savings goals. With whole-life plans, the amount received at the end of the premium payment term can be used as a source of cash.
A whole-life policy can also be a source of income for other purposes as well. At times one may need additional funds to meet major expenses such as college tuition, children’s wedding, or business requirements. The lumpsum amount received at the end of the premium payment term or the amount that one receives at fixed intervals can be used to meet these commitments.
Leave a legacy for tomorrow
Whole-life policies for both the spouses will provide an extra financial resource that can be relied upon during retirement. If one predeceases the other, the policy death benefit will provide additional financial support for the surviving individual.
The policy on the spouse may also help ensure a minimum inheritance to children or grandchildren even after the death of the insured. Whole-life plans are ideal for estate planning - individuals who wish to pass on their estate in an unfettered manner to their legal heirs - as it helps in the creation of wealth.
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