Women in today’s world are not confined to their age-old roles of being the caretaker of the family. Instead, they aspire and shine at being equals with their male counterparts. And this is not solely limited to sharing work pressure, but also includes the sharing of responsibilities when the time comes. While the goals that women had over the past have changed radically for good, the fact still remains that they need ample finances to tick off these goals.
Despite smart financial planning being a crucial part of managing one’s finances, having a secure backup plan is also essential. A life insurance policy is what helps protect the dependents of a woman, be it her spouse, her children or even her parents. However, there is very low awareness about this subject and most women still simply sign on the dotted line trusting the men in their life. Whatever decision they take regarding the type of policy, the sum assured, and the different policy features, are blindly accepted without any second thoughts. There may be little to no consideration for a woman’s perspective in such cases. But as a woman, who knows your needs better than yourself?
There are several insurance plans to choose from. Depending on your requirement, you can select a suitable plan by ticking all the necessary check-boxes. But to secure your and your family’s future, you can choose an endowment policy.
An endowment plan is a life cover that not only has the protection of the insured as its objective, but also helps in saving for the future. A part of the premium is apportioned towards savings which are paid if the policyholder survives the policy tenure. Moreover, this amount is guaranteed upfront. Thus, when buying the policy, you are aware of the guaranteed returns at the end of the policy period. In addition to that, endowment plans also accrue a bonus that is paid to the policyholder.
Endowment plans are available as both long-term and short-term plans. So, depending on the time frame, you can opt for a suitable policy.
Here are some ways in which an endowment policy can come in handy for woman policyholders –
- Building a retirement corpus
If the policyholder survives the entire duration of the policy, the endowment plan pays a maturity benefit. This amount is generally a lump sum payment. The regular income that your policy accrues over its tenure can help you build a dependable retirement corpus for your golden years. Further, during the premium payment period, you can part your entire savings (or a portion) in the endowment plan instead of letting it earn nominal bank interest.
- Buying a dream house
The maturity payout which your endowment policy pays can be used to pay for large ticket purchases. For instance, the down-payment of your dream home is possible using the endowment policy which pays a substantial amount.
- Funding children’s education or marriage
For a mother, paying for her child’s education can be a large investment to secure her child’s future. With the help of the maturity proceeds of an endowment plan, this milestone in your child’s life can be met.
- Supporting your financial dependents in your absence
While an endowment plan provides coverage maturity benefits which you can make the most of, it also fulfils its basic purpose of providing protection to your dependents. Thus, in the event of an unfortunate demise, the insurance company pays a sum assured to the nominees in your policy. This can help to financially support your dependents in your absence.
- Settling debts or liabilities
Since a lump sum payment is offered under an endowment plan at its maturity, it can be used to pay off any pending loans or liabilities before your retirement age. This ensures there is no financial burden as you cross into your golden years.
Things to consider before buying an endowment plan
Before putting in your hard-earned money for the protection of your life and savings, here are some things to consider before buying an endowment plan:
- Analysing your requirements helps you to shortlist only those plans that meet your requirements.
- Zeroing down to the one suitable policy is the next step that can help you.
- Conducting a background check of the insurance company can help you understand critical ratios of the insurance company that aids your purchase decision.
- Loan facility against your policy and policy withdrawals are some features to keep in mind when selecting an endowment policy.
- Lastly, thoroughly understand the terms and conditions before making the payment.
