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Milestones of Life for Which You Might Want Term Insurance
True to its name, term life insurance covers you for a
specific pre-determined tenure. When you buy this form of life insurance plan, you
select the term for which you want to be covered. The term can range
pretty wide – leading insurers in Singapore are known to offer term insurance
plans from 10 years to over 80 years.
But how does one
appropriately select the tenure of coverage? Surely there must be some
yardstick?
Honestly, the answer to those
questions may differ from person to person. The tenure suitable for one person
may not be suitable for another. A lot of things come into play when selecting
the term for which you want coverage. You might want to keep your unique
financial needs in perspective and think about how many dependents you have,
among other things.
You may also want the term
plan to coincide with certain milestones in your life. In this article,
we take a look at certain milestones for which it is advisable to consider
taking a term life insurance plan.
1. When tying the
knot
Getting married marks new
beginnings for you and your spouse. You are no longer an individual but rather,
a part of a whole. You would want to ensure that your spouse stays financially
secured no matter what happens in life. It is quite likely that the two of you
have shared debt – perhaps a wedding loan, a few card bills, and so on. Taking
a term life plan when getting
married will ensure your spouse’s financial security in case something
unfortunate happens. A term plan can prove to be especially important if your
spouse is a homemaker and yours is a single-income home.
2. When planning for
your kids’ education
Experts estimate that it can cost more than S$600,000 to raise a child in Singapore. With expenses that go into 6-figure sum (or, perhaps even a million dollars in some cases), saving up for higher education will be hard enough as it is. Yet, you would want to ensure that your child gets the best, whether they choose to pursue their degree in Singapore or abroad. Apart from putting aside funds and making investments for your child’s further studies, it might also be prudent to take a term plan for yourself to cover their future needs. In case something unfortunate happens, you would want your child to go all the way through college without finances being an obstacle in the way of their dreams.
3. When buying your own home
Buying a house is indeed a
huge milestone (and a dream we all harbour, right?). And, as we do know,
housing in the country can be pretty costly – often running north in the
6-figure range. Moreover, your mortgage is most likely going to keep you busy
for at least the next three decades. Now, if you have a stable job, paying off
your mortgage might seem easy enough…but what if things go awry. How will your
spouse pay for the mortgage on their own? You wouldn’t want your loved ones to
suffer from the hassles and insecurities that come with foreclosure.
Having a term insurance plan will ensure that
your spouse can pay off the mortgage and not worry about losing their home.
Even if you have HPS or private mortgage insurance, a term plan can still prove
quite beneficial. This is because unlike HPS or private mortgage insurance,
term plans maintain the same sum assured throughout (unlike mortgage reducing
term assurance). In fact, you may even opt out of HPS for your HDB housing, if
you are covered by a term plan.
As we can see, term life insurance can truly offer
much-needed coverage for so many milestones in your life. Do speak to a
financial consultant today
for help in selecting the right term life insurance plan. Good luck!
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