Term insurance is the most basic type of life insurance that offers financial protection to your loved ones in your absence. In the case of an unfortunate incident during the policy term, the plan pays a guaranteed life cover to the nominee. Term insurance is an affordable way to secure your family financially and a must-have financial tool. However, you may wonder when to buy term insurance. Ideally, the earlier you buy term insurance, the better it is. However, you can buy it at a later stage as well. Let’s find out the best age to buy term insurance and how it can help you at every stage of life.

Best life stage to buy a term plan

Below are some points that can help you decide when to buy term life insurance:

Early 20s and unmarried

Mid/Late 20s and married

Parenthood

Parenthood

In your 30s

In your 40s

In your 50s

Early 20s and unmarried

Your early 20s is the ideal time to purchase term insurance. When you purchase term insurance at a young age, you benefit from lower premiums. Moreover, the premium rate is locked at the time of purchase and remains constant throughout the entire policy duration. Also, the earlier you secure your loved ones, the more at ease you can be to concentrate on other financial goals. While you may be unmarried, you can still purchase the plan and add your spouse and children to the plan in the future.

Mid/Late 20s and married

By your mid or late 20s, you may be married. A term insurance plan can help you cover your spouse. In the case of an untoward incident during the policy term, you can rest assured your spouse will receive the necessary financial support to carry on with their life.

Parenthood

A child is a blessing but can also add to your financial responsibilities. New parents need to start preparing for their children’s financial needs from the start. You must plan for various expenses like healthcare, education, and other essential needs. Buying a term insurance plan at this phase ensures that your child always has a financial safety net to rely on. In your absence, the life cover from the term plan ensures that your child can pursue their goals without any financial constraints.

In your 30s

Most people are married and have children in their 30s. Buying a term insurance plan at this stage can ensure your loved one’s financial security. You may have additional financial obligations during these years, such as a home loan or a car loan. A term insurance plan can offer your loved ones the financial backing to settle these loans in your absence.

In your 40s

Your 40s can be a critical time. You may have ongoing loans. Your children may also be older and planning for higher education. A term insurance plan can cover all of these needs and provide for your loved ones.

In your 50s

At this stage, you are likely planning for retirement soon. However, an untoward incident can disrupt your family’s peace. A term insurance plan ensures your loved ones have enough financial security. Knowing your family will be financially protected can offer you peace of mind.

When should you purchase a term insurance plan?

Apart from your age, it is also important to consider purchasing term insurance in certain situations.
Below are some situations where buying a term insurance plan is suitable:

If you have a tight budget

Term insurance is one of the most affordable life insurance products. It can offer a high sum assured at a relatively low premium. If you are on a tight budget but want to secure your family’s financial future, term insurance can be an excellent option.

If you are the sole breadwinner

Purchasing a term insurance plan can be extremely important as the sole breadwinner. Your family can struggle to stay afloat and cover their essential needs in your absence. Term insurance can offer your loved ones a safety net when they no longer have your income to rely on.

If your business is cash-strapped

Term insurance serves as a dependable tool for repaying outstanding business debts and prevents the family from being burdened with your business’ financial liabilities. The life cover can secure your loved ones and ensure that your business does not suffer after you.

If you have labour-class employees

If you are an employer with labour-class employees, you can buy a term insurance plan for them as an employee welfare measure. This allows you to contribute to the financial security of your employees' families.

 

 

Conclusion

Term insurance not only offers affordable financial protection but also ensures that your family and assets are shielded from the potential financial repercussions of unforeseen events. The decision of when to buy term insurance is a significant consideration. While it is recommended to buy it early in life, such as in your 20s, you can also buy it at a later stage. Beyond age considerations, specific situations may also necessitate investing in term insurance.

Therefore, it is advised to evaluate your financial needs and your family’s requirements and consider buying a term insurance plan as soon as possible.

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COMP/DOC/Jan/2024/81/5159

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