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Leverage Life Insurance in Your Retirement Planning

We all want to spend our last few years comfortably but planning for it can be quite complicated with so many options for long-term gains available in the market today. It is therefore important to allocate your money in the right places so you enjoy your retirement years. You can invest in mutual funds or any other financial tools but life insurance is like hitting two birds with one stone – you get the protection that you need and long-term savings for a comfortable life ahead.


So what type should you get, you might ask. If you’re the kind of person, who doesn’t want to take big risks, then the endowment plan is the right choice for you. In this setup, the company will have to pay insurers a set amount after the maturity period or death of the policyholder. If you get to live until the maturity date, then you’ll receive a maturity benefit that can help you live comfortably in your retirement years. Should the person pass away before the maturity date, then the nominee will get the entire death benefit. As such, this sounds like a good investment plan for your retirement.

There’s another form of insurance called unit-linked plans. The policy fund is divided into two parts; one is for life coverage and the other one is allocated in capital markets for return. After say 15 to 20 years, you’ll be surprised by the returns that could very well cover your retirement needs.

Aside from this, you can also consider retirement plans and whole life plans. Just as the name suggests, retirement plans let you save up until retirement, in which time you start getting monthly returns. This arrangement gives you a regular cash flow that will cover you for the rest of your retirement years. Meanwhile, whole life insurance offers coverage for the entire life of the policyholder or until 100. The sum assured will then go to the nominee at the time of death.

According to financial experts, everyone should include life insurance as part of their financial planning. Aside from the returns, you will get when you retire, you will also prepare your loved one in unfortunate circumstances. This will take care of your family even if you’re not around. This is most critical in cases of breadwinners, who take care of their family’s welfare. Should they pass away, their families will surely face financial difficulties. Life insurance policies hope to take care of these needs in case of unexpected death.


Experts say one should make life insurance part of their financial plan. Insurance can help meet the needs of the policyholders’ family in case of the unfortunate death of the policyholder. In this case, the money is paid to the nominee. This helps mostly in cases, where there is a single breadwinner in the family. When this person passes away, the family is expected to face many financial difficulties. However, a life insurance policy can take care of the policyholder’s family.

In the case of retirement, one should make investment decisions early on. Time plays a big role to get a good lump sum during retirement. You’ll have to give time for your funds to grow. For this to happen, it is important to be very disciplined with how you manage your funds. You have to avoid stopping paying your premiums or surrendering your policy.

Based on materials from Financial Express

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