Skip to main content

Getting Insured at young age Saves a lot of money



How many of you have received a call from an insurance company or an agent trying to sell you a policy? I am sure that every professional in their 20s or early 30s would have received such a call. But have you ever stopped and thought whether you have adequate insurance cover, especially if you are a young working professional with financial liabilities? In most cases, I would assume the answer is a big 'No'. Insurance in the early years of professional life may sound a waste of money when other lifestyle and personal expenses take priority.

Young professionals today, anywhere in their 20s or early 30s, are financially independent. Many manage their own finances and investments like paying off education loans, buying own cars and investing in property – mostly first homes. The last decade has also seen a major shift in the lifestyle of young professionals with more working hours, higher stress levels and an alarming rise of related lifestyle diseases like diabetes, obesity and cholesterol. In such a scenario, insuring oneself becomes as essential as other expenses.


Additionally, many of these young people provide financial support to their families, either partially or totally. In such a scenario, life insurance as well as health insurance is absolutely critical so that in case of any unfortunate event like an accident or a sudden demise, the family doesn't go through a financial trauma as well. Even if one is not contributing towards family income, a health cover or a rider is a must so that in time of need, the cost of treatment is covered and the family doesn't face a financial setback.


There are various insurance options young professionals can choose from, depending on their needs. From retirement, health to pure protection — there is an insurance cover for all of these. It is advisable to invest earlier than later in insurance products – for example, if you are investing for retirement, the earlier you begin investing, larger the corpus would be on maturity. Term insurance is pure insurance and is very cost-effective. A term plan, coupled with an additional health rider, can give you a 360-degree protection in any exigency. Many insurance companies have also launched online term insurance products that are cheaper and easier to buy. You can log on to any comparator site like policybazaar.com or apnainsurance.com and compare the rates of term plans offered by all the insurance companies.


Another reason why some of you do not buy insurance earlier in life is because your company (in most cases) covers you under a group life and health plan. The key thing to remember is that the group cover may not be sufficient in your case or aligned to your income. Secondly, when one is young and healthy, you are a better risk; hence, insurance companies can offer you a life cover at lower rates. If you apply for a personal life insurance later in life, your application may be rejected or you may end up paying higher premiums depending on your medical history.


Investing early in insurance will also help you save tax and instil in you the habit of saving and financial discipline that ensures peace of mind in the long run. So, if you are a young professional and have not insured yourself yet, the next time you come across any material on insurance or a call from an insurance company, hopefully you will give it a serious thought.

 

Popular posts from this blog

How to Decide your asset allocation with Mutual Funds?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) How to Decide your asset allocation ? The funds that base their equity allocation on market valuation have given stable returns in the past. Pick these if you are a buy-and-forget investor. Small investors are often victims of greed and fear. When markets are rising, greed makes the small investor increase his exposure to stocks. And when stocks crash to low levels, fear makes him redeem his investments. But there are a few funds that avoid this risk by continuously changing the asset mix of their portfolios. Their allocation to equity is not based on the fund manager's outlook for the market, but on its valuations. Our top pick is the Franklin Templeton Dynamic PE Ratio Fund, a fund of funds that divides its corpus between two schemes from the same fund house-the...

Zero Coupon Bonds or discount bond or deep discount bond

A ZERO-COUPON bond (also called a discount bond or deep discount bond ) is a bond bought at a price lower than its face value with the face value repaid at the time of maturity.   There is no coupon or interim payments, hence the term zero-coupon bond. Investors earn return from the compounded interest all paid at maturity plus the difference between the discounted price of the bond and its par (or redemption) value. In contrast, an investor who has a regular bond receives income from coupon payments, which are usually made semi-annually. The investor also receives the principal or face value of the investment when the bond matures. Zero-coupon bonds may be long or short-term investments.   Long term zero coupon maturity dates typically start at 10 years. The bonds can be held until maturity or sold on secondary bond markets.

NFO Review: Edelweiss Select Midcap Fund

      Edelweiss Mutual Fund has announced the launch of another equity fund after a gap of nearly two years. This fund will be focused on mid cap stocks.   Investment Strategy The primary investment objective of the scheme is to generate long term capital appreciation from a portfolio predominantly comprising of equity and equity related securities of mid cap companies. The scheme may invest upto 100% in equity and equity related securities of companies falling in top 101 to 300 companies by market capitalization. However, it may also invest upto 20% in other listed companies as well as in debt and money market instruments.   Fund Manager Mr. Paul Parampreet and Mr. Nandik Mallik will co-manage the scheme. Mr. Paul Parampreet has done PGDM (IIM – Calcutta) and B.Tech (IIT-Kharagpur). With overall experience of 6 years, he has worked with Edelweiss Securities Ltd. SDG India Pvt. Ltd. ICICI Bank and BG India Pvt. Ltd. Mr. Nandik Malik has done MS-Finance (London Business Schoo...

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...

DSP BlackRock US Flexible Equity Fund - New DSP BlackRock Fund

  DSP BlackRock US Flexible Equity Fund is a feeder fund which will give Indian investors access to US equities by   predominantly investing in the BlackRock Global Funds–US Flexible Equity Fund (BGF - USFEF). BGF - USFEF invests at least 70% of its total assets in the equity securities of companies having economic activity in the US.BGF - USFEF normally invests in securities that, in the opinion of the Investment Adviser, exhibit either growth or value investment characteristics, placing an emphasis as the market outlook warrants. BGF – USFEF's investment strategy is based on the belief that incorporating growth/momentum and valuation factors with disciplined security selection and portfolio construction will provide consistent and repeatable investment success.   Why should one invest in this Scheme?   By investing in DSP BlackRock US Flexible*Equity Fund, investors can get access to: The world's largest country by GDP at USD 15.1 trillion^ ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now