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5 reasons why everyone buys life insurance

Updated on February 20, 2018

Life insurance should be one of the most important aspects of anyone’s investment. Unfortunately, for the majority of the people, life insurance becomes a part of life only when one of the friends or family members gets an insurance license. This is a major flaw in the system because the person who is buying insurance in such manner is not actually buying it but it is being sold to them.

On the other hand, there are a good number of people who genuinely buy life insurance for the sake of the benefits it comes with. Life insurance provides you and your family the much required financial support. In this article, we will discuss top 5 reasons why everyone buys life insurance.

1. To take care of the loved ones

This is a little painful but very crucial aspect of any life insurance. It provides the sum assured cover at the time of unforeseen circumstances. When you are not there with the family, there will be a definite downfall in the gross income of the household which will have a long-term impact on the financial situation of your family. While they are fighting with the emotional stress of losing you, the financial support will go a long way in getting back on the feet.

2. Clearing the debts

Most of us have some debt on us. After you are gone, in many cases the debts are carried forward to the next of kin that creates additional financial pressure on them. Life insurance policy can easily match these debts and your family can live a much easier life.

3. Children’s expenses

In order to ensure that your children have a good college education, life insurance is a must buy the tool. It can ease down the expenses like college fees, living expenses, and another additional cost.

4. Retirement Goals

There are life insurance policies that act as retirement plans as well. These insurance policies provide you the cover in such a way that you can enjoy monthly fixed income for the rest of your life after retirement. In order to make sure that the monthly income is ample for the future, you should start investing in such plans early.

5. Tax saving

This is one of the most common reasons for buying an insurance policy. Though we mostly need 2-4 policies for different goals all of them assure some tax rebate for sure. The amount that is saved in terms of taxes via investment in an insurance policy can be considered as saving or even extra income.

It is very important for everyone to have at least one or two life insurance policies so that in any situation you and your family are well prepared. In the case of any unforeseen circumstances, these policies go a long way to ease down the financial crisis that may occur due to the loss. While buying an insurance policy you have to be very sure about the insurance company, where your investment is going and what kind of benefits are attached to the policy like the sum assured so that you can plan the future accordingly.

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