Amit was an IT professional who lived happily with his parents, wife Sarita, and his 5-year-old son. The flexible timings, lucrative annual package, foreign tours, and every other job-related perk proved to be a bonus in his professional life.
When Rohan, Amit’s childhood friend, asked Amit whether he planned for his retirement, he had some ready excuses like he could purchase it later, and so on. Most of us have such reasons in our mind but we don’t confront them. This eventually leads to procrastination which can turn out to be highly expensive shortly.
Using Life Insurance for Retirement Planning
Rohan realized that Amit didn’t have a concrete reason for not planning for his retirement. After hearing his excuses, Rohan explained the importance of retirement planning. “The level of uncertainty in our job is very high. Retirement can be a boon or a curse depending on how well one plans for it.
“Life insurance should be considered an important element of retirement planning. An individual needs to understand about using life insurance to get retirement income.”
Amit enquired, “Life insurance after retirement? How will it help me? ”
Rohan explained the following factors:
Security for Family
Ensuring that a specific amount of money will be available to your family even if other retirement funds are depleted when you pass away, is an appealing aspect of life insurance. Life insurance offers death benefits at an affordable premium. So, instead of hoarding money to ensure they leave an inheritance, retirees can spend their savings on what they want without guilt. Through a simple investment in a life insurance plan, the policyholders can ensure funds will be there for their family to cover final expenses and more. This is the simplest way to use life insurance for retirement.
Flexibility to retire early
Most people wish to retire early in life. However, many people find themselves in a scenario of whether they are wealthy enough to retire early or can wait until they turn 60 or older. Life insurance can provide a way to fund early retirement years. Instead of worrying about money, you can begin an early retirement from the maturity amount you would receive through life insurance plans like ULIPs or Endowment Plans.
Life insurance can also prove to be a handy tax-planning tool. The premiums you pay and the sum assured you would receive both are tax-exempted.
Why Using Life Insurance For Retirement Planning Helps!
Rohan then added, “Amit, start with paying smaller but regular amounts every month. It’s the only financial tool that will give you dual benefits of security, wealth accumulation, and tax savings.”
Amit replied, “Thank you, Rohan, for your fruitful advice. I’ll consider planning for my retirement now itself.”
Amit was fully convinced about the benefits of using life insurance for retirement income. Are you?