Everything is fine when you have a job and a constant income stream and when you are young, you seldom think about retirement. This could be a big mistake as your future should be just as secure as the present. That is exactly why you need to consider retirement planning very seriously. One of the easiest things to do is invest in an insurance policy that can guarantee you a certain amount based on your present earnings. Most insurance policies are aimed at securing your dependent’s life after your death. But there are ways you can use that very policy to secure your retirement.
Buy a Permanent Life Insurance
When you buy a permanent policy, the cash gets accumulated in your account and it does not attract any tax. Along with protecting your life in many ways, the policy allows you to borrow tax-free money on the value. Unlike term insurance, the permanent ones cover the risk for the whole of your life and not limited to a specific number of years. You can even surrender this policy and use it for your retirement expenses without paying a penny towards tax.
List your requirements
The best way for a retirement planning is to list the things that you think will need financial help in the future. There are plenty of policies to choose from that meet different requirements of a person. Whether you want to pay your mortgage, rent, get a loan for emergencies, meet travel expenses or even money to fulfill basic living needs, there is a policy that is right for your future. An investment adviser can help you figure out your needs and help you navigate the many options.
There are insurance policies with a systematic return after maturity and the duration of maturity depends on your current age and the income you expect. This works more like a pension plan but even covers for your life in case of death or illness as well. You will either be able to surrender and make a complete withdrawal after a minimum eligible age of policy or buy a loan against the value of your entire policy. The benefit here is you will get a large sum without any tax. You can consult an insurance company to understand the policy completely and see how you can really benefit during your retirement age.