Factors to consider while buying Life Insurance in your youth
Many people in their early to mid-20s hesitate to buy life insurance as they believe that they do not need insurance at this stage of life. They feel that they can defer this investment to a later date, when they get married or have additional responsibilities like kids or retired parents.
But the pandemic has shown us that life can be unpredictable, and uncertainty can strike at any time. Hence, investing in life insurance at an early age can be a life saviour as it offers financial security to your family in case of your unfortunate demise.
Investing in a life insurance plan at an early age offers many benefits. But there are certain factors that one must consider.
One of the main benefits of investing early in a life insurance plan is that you are likely to pay lower premiums as in general, one’s health is much better, and mortality tends to be lower in younger age-groups. Thus, by spending less on premium, you would have the option of saving more and investing the money in other avenues.
You are also likely to get a larger life cover if you purchase a plan at a younger age. You might get a life cover of 15-20 times your annual income if you invest in a plan in your 20s or 30s, as compared to about 5-10 times your yearly income if you purchase a plan in your 40s or 50s.
You will also benefit from the power of compounding by investing early. You will be able to earn a higher return on your investment, which will go a long way in helping you plan for the important milestones that will come up later in life.
Also Read: Rs 15 lakh in SCSS vs Retirement Mutual Fund: Income difference will surprise senior citizens
While this may be the early start of your career, certain employers offer their employees coverage under a
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