You’re fresh out of college, and you might land up with a job immediately. You put your whole heart and soul to get your assigned tasks right to prove yourself at your first job. You might even work a few extra hours to ensure that everything goes right. Then don’t you think you deserve a reward for all the hard work you’ve put in? Well, yes, and your reward comes to you in the form of, ‘your salary is credited to your bank account’ by the end of every month.

Receiving your first salary is a different kind of joy in itself. When your salary is credited, you have a long list of things you wish to do with your first salary. However, when we are young, we don’t consider the seriousness of the unpredictability of life, which is why many millennials don’t include purchasing a term plan in the to do list with their first salary.

While buying a term policy might be the last thing on your mind, it has become a crucial aspect for providing financial protection. Hence, let’s begin by understanding the top four reasons why you should buy term insurance online with your first salary:

1. It inculcates a disciplined financial habit

Many millennials tend to be less serious about their finances. They spend their savings on purchasing fancy items like cell phones, cars, and so forth. However, purchasing a term plan at a younger age ensures you are on track with your finances. When you buy term insurance early, you make room for aligning your financial goals with the right term policy. Moreover, it will develop a healthy habit of planning your expenses at a younger age.

2. It offers coverage at a low premium

The significant advantage of purchasing a term policy at a young age is the low premium cost. When you buy term insurance early, the risk of falling sick is less. Since the premium is directly affected by your current health condition, your insurance company will charge less. That way, you’ll pay a nominal cost for a substantial term insurance coverage as the premium remains the same throughout the policy term. The life coverage will enable your loved ones to live a financially secure life in your absence.

3. It ensures proper tax planning

When you start earning income, you should start taking your taxes seriously. On receiving your first pay check, you’ll start filing your taxes. However, when you own a term plan, your tax liability could reduce. Under Section 80C of the Income Tax Act, 1961, you can claim a tax deduction up to Rs. 1, 50,000 on your taxable income against the premiums paid for a term insurance.

4. It pushes you to be responsible

As you grow older, your financial responsibilities increase. In the latter phase of life, you might even shoulder the responsibilities of your spouse and your kids. Therefore, buying a term insurance policy is the first step towards fulfilling your responsibility towards your family. When you purchase a term plan, it would offer financial protection to your loved ones in your absence. That way, your family members wouldn’t have to compromise with their standard of living when you’re not around.

Conclusion:

In a nutshell, a term insurance policy might not be an instinctive purchase when you receive your first salary. However, these compelling reasons mentioned above should convince you to make a purchase. The term insurance benefits like saving taxes, paying low premiums, and so forth, could ensure the financial security of your family and accomplish their life goals without their presence. A term policy will fondly remind you of your first adult purchase with your first salary.