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5 Reasons to Buy Term Insurance in Your 30s Research Team | Posted On Monday, July 22,2019, 05:46 PM

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5 Reasons to Buy Term Insurance in Your 30s



Buying a term insurance policy in your early years ensures your family enjoys a robust financial cushion in case of an eventuality. Sufficient Term insurance cover helps your family stay financially independent and addresses the major financial issues of life in your absence.

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5 Reasons to Buy Term Insurance in Your 30s

1. Most Important Financial Investments

The main purpose of investment planning and financial management is to ensure you live a worry-free and financially independent retired life. The idea is to create a huge corpus to lead a comfortable life during your golden years.

So, saving up this amount requires ample time. Most financial experts advise you to avail a term insurance policy. Term insurance helps cover the risk associated with the uncertainties of life.

Term insurance offers financial assistance to your family in the form of a death benefit, which can be used to pay off an existing loan, help kids enjoy a quality education and take care of your dependents when you are not around. The best part about the term insurance plan is that you can enjoy cover of 20 times annual income, paying just 2% of your annual salary.

See Also: Term Insurance Plans with Return of Premium

2. Starting Early Means Lower Premiums

Lifestyle diseases have lower chances of affecting you in the thirties. Diseases like high blood pressure or diabetes affect you at a later stage. The effects of smoking or drinking may not be high at this age.

  • The age at which you buy term insurance will have an impact on the amount of premium you have to pay towards term insurance policy. At this age, your policy will offer high insurance cover at very affordable premiums. The same cover could cost you almost 3 times more, if you avail the plan in your 40s or 50s.
  • Before purchasing term insurance, your insurer may ask you to go through a medical test. Your insurer may reject the insurance application because of a pre-existing condition or lifestyle disease. The chances of rejection are comparatively much lower in your 30s.

See Also: Best Age to Buy a Term Insurance Plan

3. Lock Your Premiums Now:

Availing term insurance early in life helps you avail risk cover at a nominal premium. Term insurance must be availed till the time you have liabilities like a long-term loan or children’s education. Your family is dependent on you till retirement.

After this, you no longer have to take care of your kids and there may not be long-term liabilities. So, a person buying insurance cover at the age of 30, must buy a term plan with coverage up to 30 years (Across working Life). Purchasing a term plan for a short tenure will not help your family when they require it the most.

4. Tax-Saving:

Term insurance plans are excellent tools for saving taxes. Term insurance helps you avail tax benefits under Section 80C, up to Rs 1.5 Lakhs a year. Due to the absence of maturity benefits, the term insurance offers higher coverage at lower premiums. The maturity proceeds are fully tax-exempt as per the Income Tax Act, 1961.

See Also: Why Buy Term Insurance for Your Family?

5. Do Not Depend on Your Corporate Term Plan:

Make sure you have an individual term life plan in place, to take care of your family in case of any eventuality. Make sure not to rely on the term plan offered by your employer. Switching jobs to explore better opportunities helps you to grow and this mainly takes place at the peak of your career (Between 25 to 49 years).

Term Life plans offered by the employer end when you switch jobs. Buying a term life plan helps enjoy better coverage in terms of sum assured as the corporate term plans offer high cover. A term plan helps during a job-switch. So, if you have a gap of about 10 days between leaving your previous organisation and joining your new organization, then your term plan covers you in this period.

See Also: Best Term Insurance Plans In India

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