The shift from husband to father is the most important change in life stage for any man. From the second, your new born baby arrives into the world, the joy, thrill and financial responsibilities begin. And as your kid grows up, expenses also rise. A sense of responsibility sinks in and as a parent, you start on to weigh up a savings mechanism for your child’s long-term needs such as education or marriage. Yet before you start saving for your child needs, consider securing his/her future by taking a sufficient amount of life cover.
A term insurance plan is a shield that helps the surviving family members to keep up their standard of living in the event of a sudden death of the main earning member. Term insurance, therefore, acts as an income replacement tool. In addition, a life cover provides financial support to meet the various financial goals, as desired by the parent, at different life stages of the individual, in case of any mishappening.
Some of the common avenues that a parent invests in for accumulating wealth include equity funds, shares, gold, and real estate. All these are self-funded in nature. So, one has to be alive and keep investing in them for a longer duration to keep the corpus growing till the time it is put to use.
But, life might throw up spiteful surprises. The threat of demise could disrupt the entire investment process. In addition to the mental trauma, the existing members of the family will also face loss of income thereby making long term goals susceptible to vagaries of circumstance. In case the parent dies an untimely death, the child’s dream of higher studies or a plan for a decent marriage may get jeopardized.
Term insurance plans put forward sure-fire security in terms of sum assured for a fixed period of time at fixed premium rates. In case the policyholder dies during the term, the sum assured gets paid to the nominee who will be a trusted family member. The most cost-effective way of buying a term insurance plan is to buy it online. They provide high sum assured at comparatively lower premium rates and also cover you for a longer duration.
You need to have adequate life coverage in addition to all your investments and savings to help the family maintain the same standard of living in his absence. As a thumb rule, you should have a life cover of at least ten times your current annual income and then add the coverage amount required as per your family’s long-term goals.
Therefore by taking the right decision on the right time can save your family from future financial struggles even in your absence and your children will certainly fulfill their dreams if you make a wise choice of buying a term insurance plan. Be a hero of your child with the superpower of a term plan.