Why life insurance is important for retirement planning

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A person's life insurance policy is one of the most important factors in ensuring that their dependents have a secure future. A life insurance policy can also be a covering factor that provides financial protection to help a person achieve their financial goals without undue stress. Many people don't understand the details of the correlation between life and retirement planning. Here are some factors that will help us understand why life insurance is so important for retirement planning.

1. Financial security after retirement: A carefully selected financial portfolio, of which life insurance is an integral part, is essential for financial security. A pension plan may seem sufficient to provide all financial protection after retirement. However, a life insurance policy is essential for retirement planning success. In the unfortunate event of a subscriber's death, life insurance covers the policy subscriber so that they can keep enough corpus for their dependent spouse and any other family members.
2. The safety of your retirement fund: Insurance means you are covered for your financial needs. In effect, this means that your assets, both short-term and long-term, will remain intact. These funds include any retirement funds you have saved or are planning to save. In the event that the policy subscriber dies before retirement, the spouse and other family members will likely have to draw on their retirement savings to pay for daily expenses or to maintain the lifestyle. This could severely limit the financial security measures required by the family for the future. A life insurance policy entitles the subscriber or his nominees to the maturity proceeds (sum assured), in the event of the subscriber’s death during the policy term. It is a guarantee of financial security.
3. Diversified portfolio for higher returns: Diversifying your investments is important, regardless of the investment channels you have used to plan for retirement. This means investing in corporate bonds, market-linked funds and other securities. For higher returns. Due to market fluctuations and fluctuations in fund performance, the greatest gains are in the category of moderate to high risk. Life insurance plans are a great way to protect your portfolio. You can also rely on the guarantee benefits.
4. Taxes Saving: This is another important parameter that will determine your retirement investment return. The corpus you are trying accumulate will be affected by taxation of funds after retirement or before. Life insurance is included tax benefits of the Section 80C of 1961's Income Tax Act exempts premiums from tax. This allows you to plan your retirement while saving taxes.

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