Term Insurance for Retirement Planning: How Salaried Individuals Can Benefit

Retirement is often seen as the golden period of one's life, a time when you can finally put your feet up and enjoy the fruits of your labour. After years of hard work, it's only natural to want to make the most of these precious years. And when it comes to planning for retirement, financial planning becomes paramount.

For salaried individuals who have dedicated their lives to their careers, retirement planning takes on even greater significance. As you bid farewell to the daily grind and step into a new chapter of your life, ensuring financial security becomes crucial. In this context, the inclusion of term insurance emerges as a valuable option.

Term insurance comes with significant benefits & we’ll discuss them in our article below.

Let’s Understand Term Insurance,

A term insurance plan is a straightforward product that serves as a crucial element in safeguarding your family's financial future. Should you unfortunately pass away during the policy's active period, the insurance company will provide a monetary sum to your loved ones.

This sum, technically referred to as the 'sum assured', will essentially replace your income and ensure that your family's financial requirements are met without them having to make any compromises on their aspirations and way of life. Your family will receive this money according to the claim payout option you selected when purchasing the policy. Always remember term insurance is designed to provide pure risk coverage. If you live until the end of the policy term, it will not provide any benefits to you.

Term insurance can play a vital role in complementing your retirement planning strategy.

Significance of Term Insurance For Salaried Individuals During Their Retirement Years

If you are a salaried individual, regardless of your age or life stage, opting for a term life insurance cover can significantly alleviate the financial responsibilities weighing on you. Let’s find out how.

• Supports Legacy Planning: Term insurance plays a vital role in your legacy planning journey. It offers you a smart financial solution to strategically pass on your wealth to your loved ones. The death benefit provided by term insurance acts as a solid foundation, ensuring that your family has a safety net to cover immediate expenses - should you pass away while the plan is active. Whether you're looking to provide liquidity for your estate, settle debts, or make a meaningful contribution to charitable causes, term insurance offers you the opportunity to leave a lasting financial impact that goes beyond your lifetime.
• A Backbone for Your Family: As a salaried individual, you play a crucial role in supporting your family, and your income is essential for maintaining a certain standard of living. Unfortunately, if you were to pass away prematurely, the financial consequences for your dependents could be severe. That's where term insurance comes in. It acts as a strong backbone, ensuring that your family's financial needs are taken care of, even if you're no longer there to provide for them. This security enables you to concentrate on your retirement planning without the constant concern about the immediate financial implications for your loved ones in case of an unfortunate event.
• Return of Premium Feature: Certain term insurance plans offer a return of premium (ROP) option. This means that if you outlive the policy, all the premiums you've faithfully paid over the years will be returned to you - as per the policy terms and conditions. Just like you would cultivate the practice of saving from an early age by storing coins in a piggy bank, the ROP feature in term insurance motivates you to adopt a similarly disciplined approach to financial planning. This sum can act as an extra income stream during your retirement, complementing other sources such as pensions and savings.
• Living Benefits: When it comes to term insurance, the focus is primarily on providing a death benefit. However, it's worth noting that certain policies also offer rider options, such as a critical illness rider or a terminal illness rider, which provide living benefits. These benefits can prove to be incredibly valuable during your lifetime, particularly as you grow older and become more vulnerable to diseases. By having these riders in place, you can receive financial support when faced with unexpected health challenges, ultimately safeguarding your retirement savings from being depleted.
• Taxation Benefits: When it comes to managing your finances, tax saving plan is an essential aspect that should not be overlooked. As a salaried individual, finding ways to save on taxes becomes even more important. Under Section 80C* of the Income Tax Act, you can claim a deduction of up to ₹1.5 lakh on the premiums paid towards term life insurance policies every year. Moreover, when you opt for health-related add-ons like critical illness riders, hospital care riders, surgical care riders, etc., in addition to your term insurance policy, you have the added advantage of claiming deductions for the premiums paid towards these riders under Section 80D**.
  By taking advantage of these tax benefits, you have the opportunity to optimise the growth of your retirement savings while simultaneously decreasing your overall tax liability.
  Looking For Term Insurance? Consider [ABSLI Salaried Term Plan UIN: 109N141V03!^$

ABSLI Salaried Term Plan is tailored exclusively for you, a salaried individual seeking comprehensive protection for your loved ones. With the freedom to customise your plan according to your specific needs, this solution offers both lump sum and monthly income options. Whether it's ensuring your child’s education, maintaining a comfortable lifestyle, or meeting everyday expenses, this term plan is designed to provide unwavering financial support to your family members in your absence. It empowers your family to embrace the future confidently in case the unexpected happens.
Some of the Key Features of the Plan:

• Choose from a diverse range of 4 plan options to match your unique protection needs perfectly.
• Enjoy life insurance coverage that spans up to age 70.
• Select from versatile options for death benefit payouts, whether you prefer a lump-sum or monthly income.
• Additional protection with the inclusion of an inbuilt terminal illness benefit.

Wrapping Up!

By considering term insurance as part of your retirement planning strategy, you open doors to a multitude of benefits. Not only does it provide a safety net for your loved ones in the event of your untimely demise, but it also offers you peace of mind knowing that your hard-earned savings and assets are protected. Embrace the power of term insurance and embark on a journey towards a financially secure future!