Is age really just a number? Well, not so.
When it comes to life insurance, for instance, age is everything. That’s why it’s advisable to obtain coverage when you are much younger when physical vitality allows you to get a policy for its optimum value.
There are many different types of life insurance, and these solutions can be tailored to your needs. For example, there are investment-linked life insurance products, and then those allow you to borrow against the policy’s cash value.
Regardless of which you choose, though, it is advisable to opt for a life insurance policy as soon as you can financially, and here’s why.
1) Responsibilities grow
Aside from change and death, responsibility is the third permanent thing in life. Responsibilities are a reality, and they escalate as you age.
If you want to build a family of your own, you need to provide shelter, among other things. As the head of the family, you also need to provide for your children’s education.
If not this, you also need to care for your aging parents or save for your retirement. Some people support their sibling’s education or care for their ailing grandparents.
2) Inflation increases
Although most of us do not consider inflation as a factor, it should be. We should start seeing pain from an economic perspective. For one, the products and services that are relatively cheaper today would not be the same a few years from now. That is, you might have to pay more for the same products and services in the future.
Generally, inflation also increases the cost of living, which in turn affects the quality of life. Therefore, it would be much better to have liquid assets before any increase in prices. Fund-linked life insurance products can be these assets that you can quickly turn into cash when the needs arise.
3) Policies more affordable
Determining a health quotient is critical during insurance underwriting or the process of knowing whether you are capable of handling the financial demands of the insurance or not.
As such, premium payables are indicative of the person’s health. Lower premium means better health and, thereby, more affordable coverage.
Not just the monthly premiums do, but the cost of processing the required documents. Some insurance providers would waive medical examinations because you are in good health.
4) Higher compounding interests
Compound interest pertains to the exponential increase of an investment instead of linearly over time. This wealth accumulation concept applies to life insurance, which is not only about paying monthly premiums and reimbursing when needed.
More importantly, this is also about giving you a security blanket that provides you with emergency funds when your family needs it the most. It can shield you against the financial impact that life’s uncertainties throw at you.
In sum, opting for coverage when you were younger is like preempting the financial effects of specific vulnerabilities later all on in life. Not to mention life insurance is the best tool in protecting your family’s financial stability. So the earlier you start with life insurance is always better.
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