Managing finances is one of the biggest responsibilities that comes with being an adult. Along with keeping track of present expenditure, considering both small and big purchases, one also has to deliberately plan for the future. With today’s rising costs and economic factors like inflation, it is essential to have a well thought out savings plan that can help ensure you will have a financially secure future. One of the best steps you can take to do your part in securing not only yours but also your dependents’ financial future is investing in a good endowment policy.
An endowment policy is a type of life insurance, a contract that states the insured person will pay regular premiums to their insurance company. The company, in turn, will pay out a sum assured to the insured person’s beneficiary. This sum will also be paid out in case the insured person survives the policy term. It is crucial that every young adult invests in an endowment policy due to its various benefits. Here are some of them:
- Safe: One of the biggest benefits of an endowment policy is that it is entirely free of any risks. While it is true that endowment plans have lower returns, they have no market risk whatsoever, so you can rest assured all your benefits will be safe, no matter what. All you have to do is make sure all your premiums all paid on time.
- Maturity Benefit: Many tend to shy away from life insurance plans due to the absence of a maturity benefit. That is not an issue with an endowment policy, as the sum assured will be paid out to the beneficiary even in case the insured person survives past the policy tenure. This money can be used to pay off debts, mortgages and more.
- Flexibility: If payment of premiums is an issue for you when you think of buying insurance, an endowment policy will solve it for you. Premium payments in this policy are extremely flexible and can be paid monthly, half-yearly or yearly as per your convenience.
- Tax Benefit: You can save up on tax with the tax benefits offered by an endowment policy. The premiums you pay can help reduce your taxable income under Section 80C of the Income Tax Act, making it an asset when it comes to saving on taxes.
- Dual Benefits: Endowment plans are well equipped with both investment and life insurance opportunities for any individual. You can use this plan as a means to long term investment along with life insurance to ensure your loved ones will be taken care of in case you pass away during the policy tenure.
Along with these, an endowment policy also has life insurance benefits, bonuses, loan benefits and more that make them an ideal choice. Take a look at the ICICI Prudential Life endowment policy from one of the biggest insurance companies in India and invest in a plan to secure your family’s financial future!