Having insurance can help you in the event that you are unable to work. Find out how to include insurance as part of your financial planning moving forward.
You may know insurance as a protection and investment product. But do you know insurance is first and foremost a financial product?
The uniqueness of insurance is that it provides financial cover to protect against life’s many contingencies.
But what is personal financial planning and why do you need to take charge of your finances?
Planning your finances means taking charge of your money in and out not just by charting your income and expenses, but also by supplementing your savings and protecting the assets and liabilities you have.
And with the rising cost of expenses and lifestyle due to inflation, including insurance as part of your financing planning is the fundamental step to p family from potential financial stress, especially in your absence.
While you do not need to buy every insurance policy available in the market, the most important insurance you should consider getting is life and medical insurance. And if you have a car, get car insurance. If you own a house, get home insurance to protect your home and home content. It is simple.
So, what does insurance have to do with your personal finance management?
We have explained earlier that insurance is an essential part of our lives. Preparing ourselves for the unexpected, especially incidents that could impact us financially, ensures that we can still achieve our financial goals.
Besides protecting your lifestyle and family from potential financial burden, here are 5reasons why insurance should be included when you plan or manage your finances:
Hence, when you plan your finances, you should consider the type of insurance you need to purchase for optimal coverage based on these factors:
When you have these factors figured out, you can then make an informed decision on how much coverage you need and start picking the right insurance plan for peace of mind.
But why are people still not buying adequate insurance protection?
No matter how many awareness campaigns are created by insurance companies and institutions, there are many reasons why some people are still reluctant or refuse to buy insurance policies or not making it a top priority.
Some of the reasons why the public does not prefer to buy insurance:
Being able to stick to the perfect personal financial plan is as important as developing one.
Once you have finalized it, remember to review it every year especially when the time is close for you to renew a policy like home content insurance, life, and medical insurance policy, and make necessary adjustments according to your needs and financials.
Once you have laid the foundations, you can manage your finances with ease and live your life to the fullest. So, start including your insurance policy expenses in your financial plan to secure your financial future.
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