Financial planning has become integral to our lives. With increasing inflation rates and costs of living, people are leaving no stone unturned to plan their finances and invest in tools and instruments that help them save or grow their money. Unfortunately, with time, the costs associated with healthcare have been on the rise too.
When we talk about financial planning, we usually refer to savings and investments. Savings entails reducing costs and putting aside money that is invested in instruments that offer returns. Medical costs form an integral part of our expenses, and without insurance, financial planning is incomplete. In addition, these costs increase as we grow old. This is where a health insurance plan comes in.
Today, medical procedures and surgeries can cost a lot. Also, with our sedentary lifestyle and an increase in lifestyle-related illnesses, managing medical treatment costs can get overwhelming. Hence, having a health insurance plan has become a necessity.
This article will share four reasons to consider health insurance part of your financial planning.
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4 Reasons to Consider Health Insurance a Part of Financial Planning
Here are four reasons to consider health insurance while planning your finances:
Managing Medical Emergencies
Despite eating good food, exercising regularly, sleeping on time, and taking good care of yourself, medical emergencies can surround you at any time. With the high costs of medical treatments, these emergencies could wipe out years of savings and investments in one go. This is primarily because we value our lives and health over everything else. However, most of us fail to understand the importance of a health insurance plan.
If you have a comprehensive health plan with the right amount of coverage, you can manage the costs associated with such emergencies with ease. Also, if you have dependent family members, you can look at health insurance plans for the family. These plans allow you to stop worrying about money and focus on the treatment. It also keeps you financially strong for better care after the medical treatment.
Tax Benefits
To understand health insurance importance in financial terms, it is essential to look at the tax benefits. Section 80D of the Income Tax Act, 1961, offers a tax deduction of up to ₹25000 for the premium paid for health insurance for self, spouse, and children.
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You can also claim a deduction for the premium paid for the health insurance of your dependent parents. If your parents are less than 60 years old, the maximum deduction amount is ₹25000. For parents older than 60 years, the maximum deduction amount is ₹50000.
Financial Safety Net
The rising costs of medical treatments are a cause for concern for most of us. Every few years, we are battling new diseases and ailments that are due to our sedentary lifestyles. Given this landscape, managing the costs of treatment can burn a hole in our pockets.
When you opt for a health insurance policy, you get a high sum assured by paying a nominal premium. In addition, most comprehensive health insurance plans cover costs associated with hospitalisation and related expenses. This helps build a medical safety net for your family.
Financial Stability After Retirement
Until you are working, you have a regular stream of income. Hence, you can manage medical expenses with ease. However, once you retire, the income stops, and you have to rely on your savings and investments for managing regular expenses too.
During such times, having a health insurance policy that takes care of most of your medical expenses can help you manage medical emergencies and costs with relative ease. So, there is a crucial relationship between financial independence health insurance. Hence, you can use your retirement savings for other needs.
Summing Up
Remember, medical expenses are usually unavoidable and can spring up in you at any time in your life. Also, the costs of medical treatments are always increasing. Hence, your savings and investments might not be able to cover these costs completely.
With the right health insurance plan, you can be assured of such costs being covered. Hence, you can focus on other financial goals and create a corpus that gets used for its intended purpose. Financial planning cannot be complete if you do not consider medical costs. While it is impossible to put a number on the amount you might need to manage these costs in the future, a health insurance plan can keep you covered.
It is also important to assess your health insurance needs and your family’s. There are various family medical insurance plans available to protect you from sudden and unexpected medical costs. Ensure that you assess your requirements, research the market, and buy the perfect health insurance plans for the family. Good Luck!