As a parent, you must know the significance of savings in daily life, but what about the future? As unfortunate events like death can occur anytime, you have to ask yourself if you have enough money that your family can cover all of their future expenses in your absence.
To reduce the negative effects of unfortunate events on your family’s future, starting financial planning as early as possible is a must for parents. Expenses like child’s education and marriage can burn a hole through your lifelong savings. This is the main reason that you should make a financial plan as early as possible.
Benefits of early financial planning
Being a parent, you must save for certain expenses of the future without having to drain all of your savings. Consider the following benefits you can get if you start financial planning early:
Fewer saving: When you make an early financial plan, you have to save less for your future years as the interest compounds, and you earn more in the long run.
Better retirement planning: The sooner you make a financial plan, the more money you can invest in your pension plans for your retirement.
Required adjustments: A financial plan requires many changes to adapt to the dynamic environment. If you make an early financial plan, you can make the required changes and can overcome your mistakes.
Wealth accumulation: Starting early to plan financially can allow you to build wealth over time as you can invest more and can enjoy a return on your investments for a long period.
How can you utilize the benefits of early financial planning?
An ideal financial plan requires you to invest in some insurance products which can allow you to achieve your financial goals effectively. You can choose from the following insurance products according to your lifestyle:
Retirement insurance plan: As a parent, you get so busy in providing for your family, you forget about yourself. A life insurance pension plan enables you to save for your retirement and includes survival or death benefit which is given as a lump sum amount.
Unit-linked insurance plan: One of the best plans to build wealth over time, it allows you to spend a portion of your premium in funds of your choice. It also works as a traditional life insurance plan by providing a life cover, in addition of return on your investments.
Endowment policy: If you want all of your money as a lump sum when you reach a specific age, you can go for an endowment policy. It enables you to get a lump sum amount when you know you will need it in the future.
Annuity insurance plan: The best way to get a regular annual income after you retire, an annuity insurance plan makes up for a regular source of income after you stop working. You can use this income to pay off your expenses.
Edelweiss Tokio Life provides you with every insurance product mentioned above so that you can utilize the benefits of an early financial plan. Every plan comes with tax benefits under section 80C and 10 (10D).