No matter what stage you have reached in your career, investing a part of your income in an LIC policy is something you should think about. There are many advantages in investing in LIC policy. As an Insurance policy, it financially supports your loved ones in case you are no more. Depending on the type of LIC policy you invest in, it could also act as a way to help you achieve your long-term goals/dreams. Let’s look at five reasons why it’s always a good idea to invest in an LIC policy.
Security for Your Family
Expenses never come at one go. When you have a family, you need to set aside money for your various expenses like Children’s education, their wedding, your pension etc. There are a number of LIC policies that can help you plan for your future. By investing for a set number of years, and then later you can use the matured amount for your family’s needs. In case of any unfortunate event happens to you, these policies will ensure that your family stays secure and your loved ones do not have to make any unnecessary compromises.
It’s painful to see a portion of your hard earned money going away as taxes. All premiums paid under LIC policies are exempted from Income tax under section 80C. Each individual is eligible for a maximum tax benefit of Rs.1,50,000 under section 80C of Income tax act 1961. In addition to this, the money paid towards Maturity benefits, Money back plan & Death claim are also exempted from tax under section 10 (10D) of Income tax act 1961.
One cannot work forever, but you need a certain amount of money for your old age. A life insurance policy that you have invested during your productive younger age can help supplement your old age by way of pension. This gives you a regular income each month that will make your retired life more comfortable. For this reason, it is also best to start an LIC policy as early as possible.
Pay Off Debts
Most working individuals cannot afford to buy a house, car etc without a loan. While you have a steady job, paying back this loan is not a worry. However, in the case of your unfortunate demise, the burden of paying back this loan will fall on your family. Having a life insurance policy can help them pay back these loans without cutting back on their other expenses.
Last but not the least, having an LIC policy helps develop the habit of saving. While the money that saved in a bank account does gather interest, and the chances of it being spent are also very high. Choosing an LIC policy and paying premiums on a regular basis will force you to put aside a sum of money as savings. The interest on this savings is much higher than the interest gained by keeping it in the bank.
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