Monday, February 11, 2019

2 Ways You Can Ensure That Your Family's Financial Goals Are Fulfilled

A Goal Without A Plan Is Just A Wish”- Antoine de Saint-Exupéry

We set goals all the time. For instance: losing 10 kilos, eating healthy, running a marathon, writing a book and so forth. But financial goals, which are the most life-changing goals of all, are often put on the back burner.  

Accumulating funds for children’s education, building a multi million-dollar investment portfolio or starting a business can all seem a bit too hard. But it doesn’t have to be that way. With the right financial instruments, plans can be put into place, and everlasting happiness can be attained!

Here are two such investments that can help achieve your family’s financial goals:

1. Term Insurance: To Meet the financial Goals in Your Absence

What is Term Insurance?
A type of life insurance plan, term insurance protects your loved ones financially by providing an assured lump sum amount, which acts as a replacement income in your absence. This amount not only assists your family to pay for household expenses and outstanding debts but also enables them to meet goals like fulfilling your child’s educational aspirations or starting their business.

How Does Term Insurance Benefit Your Loved Ones?
The primary benefit of term insurance is that it takes care of your loved ones in your absence. Your absence can never be compensated with money; however, your family may be dependent on your earnings. After your demise, they will not only suffer emotionally but also financially. Term insurance can assist them financially in such hard times.

How Can Term Insurance Help Fulfill Your Family’s Financial Goals?
If you hope to provide the best education to your children, save for their marriage and ensure a peaceful retired life for your better half, term insurance plans can take care of these desires in your absence.

Term insurance plans assure you that the financial side of things will be taken care of even if something untoward happens to you. For instance, if your family receives the death benefit worth Rs. 1 crore after your demise, a part of the amount (10 to 15 lakhs or as required) can be used for higher education of your child.

If you want to make your term plan more comprehensive, look for adding riders like ‘Critical Illness Rider’ and ‘Accidental Death and Disability Benefit Rider’ which are provided by reputed insurers like Max Life Insurance.

2. ULIPs: To Finance Your Children's education

As parents, your children are usually at the center of your financial decisions. For them, you dream of education in a prestigious university or sending them abroad for higher studies. For this purpose, you would want to look for an investment product that gives you decent returns over the long-term along with a safety net of life cover.

A Unit-Linked Insurance Plan (ULIP) can work well in this context. ULIPs offer you the benefit of life cover along with savings in the long run. They are the ideal investment instruments, especially for those who are ready to commit to a long-term wealth creation plan. Moreover, you get the option to invest in different types of funds as per your risk appetite (equity, balanced and debt funds).

A well planned ULIP policy can be a timely support to meet certain important expenses in your life. For example, if you start a 15-year-long ULIP policy when your child is one year old, it will mature around the time when your child is planning to go for higher education. Thus, allowing your child to receive the best possible education.

Simply put, a well-timed ULIP policy can be a big help in meeting crucial expenses such as studying abroad, planning a wedding, buying a house or starting a business.

Review & Revise: 
Investing for your family’s financial goal is not a one-time exercise. To be on top of your game, it’s crucial that you evaluate the progress made by your investments every year. Doing a yearly review will help you understand how your investments are faring, and if required you could restructure your plan.

Bottom Line: 
So, whatever your family’s financial goals are, now you have a road-map on how to achieve them. Although making investments now may sound a bit heavy on your pockets, but you will deserve your reward when you get there: the dream home you have been saving up for or the best quality education you desire for your child.

You just have to make the right investments and stick to them!

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