Invest in Insurance to Meet Your Small and Big Life Goals


Did you know that with your life insurance agreement you not just secure your family financially in the event of your death but can also fulfil your short-term, mid-term and long-term financial goals and save taxes when you are employed? Yes, all at once and how.

Every time you drive past a bike showroom you cannot get enough of the latest superbikes.  And when you get a lump sum from a life insurance arrangement upon maturity, you can finally own your dream bike.

Alternately, the moment you welcome the teeny-weeny member of your family, you ensure that you get the best for your newborn. As parents, you strictly adhere to the motto of “no compromising” when it comes to your child’s well-being. A proper life insurance plan helps you pay for your child’s higher education in the best educational institutions.

Again, you enjoy a steady flow of income as long as you are employed. Your salary takes care of your daily buys. Does this cash flow stop when you retire? Not anymore. There are life insurance schemes that help you sail before the wind financially even when you retire.

Hence, life insurance policies are financial tools that typically cushion you against unforeseen monetary risks such as the untimely death of the only earning member of the family and post-retirement expenses. However, insurance companies often offer a number of other products annexed to these policies. These products help create a lump sum that allows you to meet your life goals.

Once you set your goals, your next task is to choose an investment option that would back your dreams financially. Let us see how investing in insurance enable you to meet your different financial milestones:

What are the different life goals?

  1. Short-term life goals:

Setting short-term life goals help lay the foundation for aiming bigger. Once you happen to fulfil these goals, you are all set to achieve the next big thing. It elevates your confidence. You might be a globetrotter and want to travel solo or might want to see the world and its wonders with your entire family. You might be planning to buy a luxury car or a high-end bike for some time now. You are done with renting accommodation and wish to own an apartment. They can be all yours even before you realise if you invest your hard-earned money in a proper insurance policy. 

TIp: All these short-term life goals can be fulfilled by investing in life insurance policies like Endowment plans.

  1. Mid-term life goals:

Mid-term life goals act as a buffer between the short-term and the long-term life goals. These take a bit more planning than short-term life goals. Once you plan to marry, you may want to create a fund to take care of the expenses. As a parent, you would want to provide your child with all that is best for her/ him. You would like to build a corpus that helps you get your child enrolled in a university abroad and fulfil her/ his dream. Indian weddings can be quite a huge affair. Marrying your daughter or our son off requires you to spend a considerable sum of money. 

Tip: What if these mid-term life goals are sponsored by the life insurance policy—such as ULIP— you had been investing in? This will definitely take the load off your shoulder.

  1. Long-term life goals:

The most important long-term life goal is to secure your post-retirement years financially. You may want to start investing now in order to create a corpus at the time of maturity. You may want to save enough to beat inflation. You would not want to give up on the standard of living you are used to now. Make sure your investment generates monthly income when you retire. 
Tip: Investing in a life insurance policy like ULIP will look after your daily expenses when you hang your boots.

Different life insurance policies catering to your varied needs:

There are a number of life insurance policies that cater to your diversified requirements. The various kinds of life insurance policies that take care of your different needs are as follows:

1.Pure term insurance plans

This is the most rudimentary form of term insurance. The beneficiary of the deceased policyholder receives the sum assured in the insurance plan provided the policyholder dies during the term of the policy. However, the insurer makes no payout if the policyholder outlives the tenure of the policy. It is the most economical life insurance option. 

All you need is to pay a nominal amount as a monthly premium and in turn yield a large death benefit. The beneficiary can fall back on the insurance money in order to meet expenses related to children’s education even when you are not there. The beneficiary can also utilise the money as capital to start a business endeavour. An insurance payout can cover a wide range of expenditure.

2. Traditional Endowment plans

An endowment policy is a life insurance policy that covers your life as well as acts as a saving instrument over a specific period of time. Your regular contribution amounts to a lump sum, which you receive upon maturity if you outlive the tenure of the policy. This amount can be utilised to meet various life goals such as a solo trip or a vacation with family, buying a property, your marriage, funding your child’s higher education, etc. 

Alternatively, this fund can help you sail through your retirement years. Endowment policies, therefore, guarantee both savings and life cover, all under the same roof.

3. ULIP plans

Unit Linked Insurance Plan or ULIP is a market-linked investment that also provides monetary protection. In ULIP, a certain percentage of the insurance paid is invested in mutual funds, stock, equity, debts, bonds, etc and the remaining portion of the premium is put to use as a life cover. You may invest in ULIP if you can follow your investments regularly if you are fine with a long-term investment or have a varying degree of risk-taking appetite. 

And what’s more? ULIP provides tax-exemption under section 80C, promises market-linked returns and offers liquidity. Moreover, ULIP charges a low premium. ULIP is useful in supporting your child’s higher education.

4. Annuity or Pension plan

When you invest in a pension plan you create a corpus that takes care of your retired life. An annuity or a pension plan acts as your regular source of income when you are no longer working. There is also a tax exemption u/s 80CCC for a premium paid towards annuity plans. However, the annuity is taxable in the hands of the annuitant!

However, it is always better to keep in mind the following factors before you choose a policy:

  1. Your requirements
  2. Your income level
  3. Your risk appetite
  4. What stage of life you are currently in
  5. Your future requirements

Life insurance and different stages of life hand-in-hand:

Investing in life insurance policies can be handy in a number of ways. Considering that your priorities and your life goals will change with time, let us find out how life insurance policies aid you in realising your dreams in different stages of life:

  1. At the start of your career

When you are in your early 20s and have landed a good job, the world is your oyster. You might want to fulfil all the short-term goals of your life and simultaneously plan for your retirement. Investing in a pure endowment policy may answer all your worries. It is a disciplined way of saving for your future.  Moreover, it enables you to receive a lump sum at the end of a specific period of time. Since now is the time when you usually would not have to run a family, you may use this amount in going off to your dream vacation, buying a luxury automobile, or make a down payment for the house you always wanted for yourself.

2. When you decide to get married

If marriage is on your cards, you may want to invest in a pure term insurance plan. A term insurance plan financially secures the spouse and the immediate family in case of the investor’s untimely demise. The thought that you have covered your loved ones financially even when you are not around will give you immense peace of mind. 

Moreover, if you already have home loans and other liabilities to take care of, buying term insurance will ensure that the burden will not fall upon your family. If you buy term insurance early in your career you pay lesser premiums. Hence, buying a term insurance plan when you are in good health and prime of your career might be a wise choice—make hay while the sun shines.

3. Stepping into parenthood

The newest member of your family brings a lot of happiness and excitement with her/his arrival. But she/he also brings a lot of anticipations and responsibilities for you: rocking the newborn to sleep, changing her/his diaper, choosing the best baby products for the tiny tot and, above all, providing your child with the best possible future. And in no time you will find yourself arranging funds for her higher education and marriage. 

A child insurance policy on maturity or a ULIP plan offers enough money for your child’s higher education. Also, you would want to financially cover your family more than ever before. Investing in a term insurance policy will take care of your dependents financially in your absence. It is always better to start investing in a child insurance policy within a year of the child’s birth. This gives you a good 18/20 years to save for your child’s future, which results in a good amount of money.

4. When your retirement is round-the-corner

Your salary takes care of your daily needs. You are no longer dependent on your parents for all your buys. Does retirement put an end to your financial independence? Not anymore if you plan your investment accordingly. Your retirement planning may include your daily living expenses and your medical expenses. Life insurance—Whole Life ULIP—is the answer to all your worries. 

Here, you can invest your money either in equity or debt or in safer government securities. The lump sum that you receive upon retirement helps maintain a lifestyle and also keeps up with inflation.  If you have already invested in equity, transfer the fund to debt ULIPs to protect your money from market risks. Remember, it is never too early to plan for your retirement.


Setting up life goals is not an end in itself. What matters most is making provisions for fulfilling those goals. Taking a long hard look at your finances might give you a good start. Know where you stand monetarily and plan accordingly. If you settle on a financial arrangement that lets you eat your cake and have it too, you are good to go. Life insurance does exactly the same. It provides you and your family—in the event of your death—with financial protection. At the same time, it acts as a financial instrument that helps you achieve your life goals--be it travelling the world solo, supporting your child’s education or shielding your old age. An organised investment, such as life insurance, helps achieve these goals in no time.

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