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Latest articles on Life Insurance, Non-life Insurance, Mutual Funds, Bonds, Small Saving Schemes and Personal Finance to help you make well-informed money decisions.
Protection:
Families with young, dependent children need adequate protection against losing their primary wage earner's income if and when premature and unexpected death occurs.
Emergency Fund:
Life insurance provides an additional consideration by providing an emergency fund to provide money for survivors. It buys the time so essential and necessary that is needed to adjust to the death of a parent or spouse.
The insurance proceeds provide a temporary buffer that gives the survivor the time and the inclination to adjust to the new and unprecedented situation. The surviving beneficiary has the option to consider career alternatives as well as make rationally based and thoroughly informed decisions.
Education:
Yet another priority need for young families is building adequate funds for higher education costs. The need for highly specialised education is greater than ever before. Qualified students obviously enjoy better lifestyles and have more rewarding careers compared to other people.
Every year, the cost of education rises beyond estimated limits. Capitation fees and deposits only aggravate this situation further. Every young family must start a substantial savings plan. The sooner, the better since compounded interest schemes need time to work and show their appreciative worth. Life insurance also offers handsome reductions in taxes.
Retirement:
Young families should also plan for retirement in the long run. Investment and pension plans are not adequate to fund the retirement needs at times. Once a family attains a specific standard of living, it is very hard to adjust to a reduced standard during the retirement years.
Systematic savings over a working lifetime is the key towards supplementing other retirement programmes. The old rule of saving 10 percent of the annual income still holds true for single income young families. Young families with modest incomes must commence with at least a 10 percent guideline if they cannot make a total commitment immediately.
Disability:
A single income young family would be in an extremely perilous situation if there would be a loss of income owing to a disability. In case an income provider is unable to work, the economic consequences could be severe for the family. Not only does the family have to maintain the established standard of living, it also has to shoulder the additional burden of a disabled member within itself. Disability is the major need that is to be addressed and protection against this loss is a priority.
Besides in most of the families today, two incomes are an absolute necessity. For these households, the protection of both the income producers is extremely essential.
Single Young Adults:
People who belong to the young, single adult age group are young, healthy and energetic. Since they are single, they enjoy more freedom and have fast access to money. Most of them bear carefree attitudes that have been passed on to them from their families. As they begin to assume new responsibilities and gain maturity, it can be a major transition in their lifestyles.
The ironic part about single, young individuals is that they might possess extensive funds but none of them have established any specific savings plans or cash reserves in case of any emergency. Single, young people need to protect their newly acquired status and their earning capacity besides their human life-value the most. Their priorities' list must be topped by disability income insurance so they are protected against loss of income and loss of insurability in the future.
People from this socio-economic group also have loans to pay off and high credit card balances. They will also need financial help so that their debts are paid off until they learn to provide steady finance for themselves.
Rising Debts:
Most single, young adults are possessed by a dominant need to pay off their debts and fulfill their retirement obligations at the same time. They also need help in planning their budget for the future.
Most single, young adults lack an understanding of the virtues of saving. The value of future planning and adhering to the plans made is yet to be impressed upon their minds. They don't realise the significance of compound interest and tax implications on savings and investment choices. Professional insurance agents can provide a lot of help to them in this regard, to say the least.
One of the most important needs, voiced together by a majority of people in the single young adult arena is to make the right choices that are consistent with proper planning to take care of their needs. Single people are used to putting off decisions regarding their current status. It is consequently difficult to convince them that they should not put off the events that need to be done immediately.
For single, young adults there is an ever-increasing need for life insurance. Yet, the need to save money is equally important since most people don't start any serious savings until they find a suitable means of employment. For them, protection against loss of income owing to a disability must be addressed the moment the person begins earning an income.
Advantages of starting an early financial security program:
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