Why An Insurance Savings Plan Should Be Part of Your Investment Portfolio
If you earn steadily from a job or business, you want to put some money away. Maybe in a savings or investment scheme.
While there are numerous platforms to explore today, have you ever considered putting some cash with an insurance company? If you haven’t, you should. This article will reveal clear reasons why an insurance savings plan can be a valuable addition to your investment portfolio.
1. Risk Management
The inherent risks of investing are ease of liquidity, death of the investor, and investment losses by the company. An insurance savings plan makes provision for all these risks. Investments are easily liquid and companies are regulated to only take on specific, low-risk investments to guarantee the safety of savers’ funds.
Plans also come with a life insurance benefit that gives an additional bulk amount to the named beneficiary of the saver in the event of death.
This way, you are assured total protection for your funds and don’t have to choose between any of the inherent risks.
2. Financial Security
By including insurance in your investment portfolio, you can mitigate the potential financial impact of different risks from accidents, to illnesses, and natural disasters.
Imagine delaying gratification for years, having millions of naira, only to lose it on one sudden surgery. This can be devastating.
So insurance plans protect your other investments so you don’t liquidate them untimely due to a sudden occurrence.
3. Diversification
Want to diversify your holdings and reduce risks? Insurance presents this opportunity. Plans are flexible and diverse, allowing you to customize your portfolio to meet your financial goals.
You can take a custom plan for your children’s education or insure a key person in your business. There are also plans to cover your living expenses if you are unable to work due to an illness or injury.
By diversifying your investments, you even out losses in one asset class and improve the overall stability of your portfolio.
4. Tax Benefits
Finally, insurance savings offer tax benefits. Premiums on most life insurance are tax-deductible. They allow you to enjoy tax-free withdrawals and tax-deferred growth on your investments.
Overall, an insurance savings plan can be a valuable component of a well-rounded investment portfolio, helping to protect against financial losses and providing financial security for you and your loved ones.
Article originally published with Heirs Life Assurance.
Author: Theophilus Adeyinka
This write-up serves informational purposes only. It should not be considered explicit financial or legal advice. Not all information will be accurate. Before making any serious financial decisions, consult a professional.
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