More and more people are now becoming financially literate, considering various investment options to grow their money. For some, getting life insurance is a viable investment option because of the benefits that they get from it. This article tackles some of the reasons why life insurance is a good investment.
Feasible Retirement Plan
One of the primary reasons why you need to get life insurance is that it is a feasible retirement plan. More often than not, people who retire also tend to lose their source of income. This is where life insurance comes in. In case you don’t get to use the plan before you enter the retirement age, you have the opportunity to get your money as a lump sum or every month, depending on the terms of your policy.
You can consider your life insurance as your source of income when you retire. The finance experts behind qcapital.com suggest that you start as early as possible because, in this way, you will be able to maximize the benefits of your plan later on during your retirement with only a meager amount to start with. Keep in mind that the earlier you start saving up, the better when it comes to life insurance. The reason behind this is that you tend to get better deals while you are younger.
Another reason why life insurance is a good investment is that it is an effective savings tool. More often than not, the premium you need to pay for your policy needs to be settled annually. However, other providers can design a quarterly or even a monthly payment schedule if you are more comfortable. It is also usually the case that the payments are automatically debited from your account. In this case, you can consider it as a bill that you need to pay, but the truth is that you are merely paying yourself first before you allocate the rest of your budget for your expenses. Thus, this is one of the most viable ways for you to save.
Security and Assurance
The primary purpose of life insurance is to offer ample protection to your family, particularly if you are the breadwinner. In case something untoward happens to you, and you lose your main source of income, then your dependents will be significantly affected. Nonetheless, when you have life insurance, you will still be able to provide your family with the quality life they deserve even after an unfortunate scenario. For instance, if your policy has a rider covering loss of income due to illness or disability, you are assured that you will have the money to cover your family’s expenses even if you cannot work.
Financial Liability Coverage
Getting life insurance is a good investment decision because it can alleviate your family from the financial liabilities that can burden your family if you pass on. In this case, all your debts will already be paid as guaranteed by life insurance, regardless of whether you still have a property loan or even a personal or credit card loan. The policy that you acquire while you are still living will be able to cover all of these, lifting off the burden from your family.
Finally, it is considered a smart move to get life insurance as an investment because you and your family can garner tax savings through it. In case you don’t get to use the money while it’s tied up in a retirement plan and opt to use it in your retirement, later on, you only need to settle a meager amount for taxes. On the other hand, should you face any untoward incident leading to your passing, your family no longer has to settle any taxes when granted the insurance claim because, in most states and countries, taxes for insurance claims are waived.
When you have life insurance, you tend to have a feasible retirement plan because, during your elderly years, you can get to enjoy the money that you have saved if you don’t get to use the plan. You also have security and assurance for you and your family when you get life insurance. In this case, your family will no longer have to deal with any of the debts you still owe after you have passed on, and they also don’t need to worry about the tax they need to pay to garner the claim rightfully theirs as your beneficiaries. All these are geared towards giving you the peace of mind that you deserve, making life insurance a good investment.
Image Source: BigStockPhoto.com (Licensed)