27 DEC 2016
Buying Life insurance as a Senior Citizen
As a senior citizen, you may be living a life of peaceful retirement. You may be trying to fulfil the dreams that you've always had, but never got the opportunity to fulfil. Like taking off for a dream vacation or engaging in a hobby like learning a musical instrument. But amidst all this, you must remember that you have to also plan your finances wisely so that the same can last you for your lifetime. Investing in annuities may hold you in good stead.
What are annuities?
Annuities are life insurance plans where you invest a lumpsum amount of money in exchange for a contractual promise by the life insurance company that they will give you back the money with interest in monthly instalments till you live. So, for example you are 60 years of age and you have a corpus of money, rather than keeping it in savings bank accounts where it does not fetch you any interest, its prudent to invest it in annuities, where the money will appreciate as well as give you a monthly payout.
How do annuities work?
In essence, the life insurance company, using information that it has about you, estimates the length of time that you may be alive and then works out as to how much to pay you back in terms of income, every month, in exchange for the corpus of money that you deposit with them. This way, you can ensure that you receive a monthly income like you used to in your working days. It will help you in planning your monthly finances and saving something for the future.
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