As you might know, some of our income goes towards our monthly expenses and another part is eaten up by taxes. The remaining can be put under savings only if you don’t have any health expenses, lifestyle needs, and miscellaneous expenses that need to be addressed. Phew! Tough life, we know. Given this scenario, is it possible at all for you to save? Yes! Here are some simple steps you can follow to save more and how insurance and e-insurance, in particular, can help.
Start saving early
Ideally, one should start saving as soon as they start earning. It is recommended that one start investing 10 to 15% of their income as soon as they start working. Distributing savings over a larger number of years reduces liabilities to a great extent. You must also have a Life Insurance plan in place so that there are no roadblocks for your savings.
Look at the risks
Risk is an inherent part of life but there are risks that can be covered. This can done using various insurance policies at different stages in your life. The policies will ensure that your savings, especially for goals such as retirement, remain untouched during emergencies.
Plan, plan and plan some more
Factoring in healthcare costs while you are planning your financial life becomes critical, as health costs keep rising at a higher rate than inflation. Adequate Health Insurance for each family member is the most effective way of managing financial needs during medical emergencies.
Increase income streams post retirement
You know you won’t have a steady income after retirement. So, you must plan to set up at least two different income sources. This is because retirement income needs are likely to be large. Reliance on a single scheme, such as a provident fund or a pension from an employer will expose you to significant risk. Therefore, many different sources from which retirement income can be generated, need to be cultivated. A good balance between different investments is also required. Annuity plans are a good option to consider. Under an annuity plan, you pay a lump sum and get a regular payment for a fixed period – similar to getting an income. However, it is essential that you check the features and compare between plans before choosing the right one. When investing in annuities, starting early will help in availing the best premium rates and one can enjoy the benefits of compounded returns.
As you can see, an insurance policy becomes your companion at every stage in life and stays with you even after retirement. That is why you need to hold an e-insurance account. This account will store all your policies electronically throughout your life. You don’t need to go through the hassles of storing a physical copy of all your policies. You can go back and review all the policies that you have held and hold at present. Having your policies in a single place will help you manage your insurance portfolio better. You can have an account in the name of each of your family members so that you don’t need to handle multiple physical policies at the same time. Be it Car Insurance, Health Insurance or Life Insurance, an e-insurance account can hold any of your insurance policies.
The magic mantra is to keep things simple so that you have fewer hassles while handling your investments. So, save, work as much as possible, make smart investment choices and keep track of your policies through an e-insurance account.
Sponsored by ICICI Prudential Life Insurance Co. Ltd
The views expressed here are solely those of the blogger in his private capacity and do not in any way represent the views of the legal enforcement authority or any other entity. The user of this information is advised to consult experts in the domain for concluding any opinion or course of action.