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Term Insurance vs. Traditional Life Insurance Policies

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Investing in a life insurance policy is the most common way to provide financial security to your family in your absence. Life insurance pays the policy benefits to your nominees if an unfortunate event occurs during its duration.

Traditional life insurance policies offer maturity or survival benefits. However, the premium for such policies is high and expensive for most people. Insurers also offer term plans, which are pure life covers available at an economical premium.

What is a term insurance plan?

It is a straightforward life plan that pays the benefits to your nominees if something untoward happens to you during the policy duration. Most term plans do not pay any survival or maturity benefits. So, the premium is lower compared to traditional life insurance policies.

Some term insurance policies offer a return of premium option. When you buy term insurance with return of premium, the insurer pays the entire amount paid at the end of the policy duration. However, the premium for these plans is higher than the amount paid for a regular term policy.

Differences between term insurance and traditional life insurance policies

Although both term and regular life insurance policies ensure financial security for your family in your absence, there are certain distinguishing factors between these two options. Here are three such points of comparison:

  • Policy benefits

Your nominees get the term insurance benefits only in your absence during the policy duration. If you survive the policy period, most term plans do not pay any maturity or survival benefits.

On the other hand, regular life insurance policies pay the sum assured (SA) to your nominees if an untoward incident occurs during its duration. If you survive the policy period, you will receive the maturity benefits as per the terms and conditions of the plan.

  • Premium cost

There are no term insurance benefits on maturity. As these plans are pure life covers, the premium is more affordable. This allows you to avail of a higher coverage at a lower premium, ensuring that your family is financially secured in your absence. You can easily opt for a higher SA based on their requirements and future financial goals, ensuring they do not face any liquidity constraints when you are not there to look after them.

In comparison, traditional life policies are costlier, and you may be unable to afford a higher SA. This may limit the benefits your family will receive if a tragic event occurs during the policy tenure.

An important consideration is that the premium of a term plan increases if you opt for a longer duration and age. However, the amount remains constant during the entire duration irrespective of the age and tenure when you buy a traditional life insurance policy.

  • Policy duration

You can choose the term policy period based on your age and current and future monetary objectives. On the other hand, most traditional life policies have a minimum duration of five years and provide coverage for a longer period.

Things to consider while choosing the right life insurance policy

When you consider buying a life insurance policy, you must not simply think of it as an investment avenue or as a means to achieve your financial objectives or to save tax. You need to keep several other factors in mind. These include:

  • Premium
  • Maximum coverage
  • Current liabilities
  • Present financial situation
  • Future financial objectives

There are several plus points of buying an online term plan, which includes lower premium, convenience, and quick process. Additionally, you can procure comprehensive coverage through riders, such as waiver of premium, permanent disability, critical illness, and accidental death benefits at a nominal cost.

Both term plans and traditional life insurance policies offer flexibility to pay the premium. You have the facility to pay it either monthly, quarterly, semi-annually, or annually according to your financial condition.

6 Features Your Chosen Term Insurance Plan Must Have

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You work hard to provide a comfortable life for your loved ones. However, there is no certainty in life, and an unfortunate event may completely change the circumstances for your family. An accident, critical ailment, or any other event can strike without warning, which can result in financial difficulties for your family members.

Therefore, it is important to create a backup plan, to ensure their financial stability. One of the best options is to avail of life insurance coverage. This type of insurance will pay the benefits to your nominees in case of your sudden absence during the policy duration.

A term insurance policy is the most affordable type of life insurance plan. You may ask “what is term insurance”? It is a pure life cover that pays the benefits to your nominees in your absence during the policy tenure. Most term plans do not offer maturity or survival benefits, which makes it an economical option to procure a higher sum assured (SA).

When you want to buy insurance coverage, you wish to reduce the premium. Although reducing your cost is important, you need to consider other features to maximize the benefits for your family in your absence. Here are six features, which you must check while buying a term insurance plan:

Flexibility in paying the benefits

Generally, term plans offered a lump sum payout of the policy benefits in case of an unfortunate event. However, this may not be a suitable option, as your family may not be capable of managing a large corpus. Therefore, several insurers now provide you with the convenience to opt for periodic payments of policy benefits to your nominees.

In this case, the insurer pays a certain part of the SA as a lump sum. They pay the balance sum in regular installments over a pre-determined period. Receiving a timely payout helps your family to meet their normal expenditures to sustain their lifestyles without having to worry about managing and investing a large corpus.

Return of premium

Term plans do not offer any survival or maturity benefits, which is why you may hesitate to buy this policy. However, many insurance companies now offer term plans that return the premium at the end of the policy period. Before you choose a term insurance with return of premium plan, remember that the cost is more for these policies.

Accidental cover

Many insurers allow you to enhance the coverage of your base online term plan through riders. It can be beneficial if you select additional riders based on your family’s requirements. If you travel frequently or work in a risky environment, you can invest in an accidental cover rider for higher benefits. If your absence results from an accident, this additional rider will pay the benefit over and above the SA to your nominees.

Critical illness cover

Treating critical illness is expensive, and the treatment may last for a prolonged tenure. A health policy will only cover the hospitalization expenses, which is why it is advisable to include a critical illness rider in your online term plan. When you are diagnosed with an ailment, the policy will pay the rider benefit as a lump sum, which you can use for treatment or any other purpose.

Rebates

A large number of insurers offer discounts and rebates if you opt for a higher SA. Additionally, women and non-smokers enjoy lower premiums due to lesser risk. Check these rebates and discounts offered by different insurers to choose the best term plan.

Multiple premium payment choices

You must buy a policy that offers flexibility in paying the term insurance premium. Insurers offer monthly, quarterly, bi-annual, and yearly options, which allow you to choose one that suits your financial situation.

It is recommended to buy an appropriate term plan to ensure the monetary well-being of your dear ones. Take time to research various options and make an informed decision.

 

What Are Mutual Funds? A Guide For New Investors

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Mutual fund investments have taken a special place in investors hearts, especially those who are new to the investing world. This is because mutual funds are an excellent and convenient way of investing your money. These investment vehicles have proved time and again that they have the potential to generate significantly higher returns. This article serves as a mutual fund investment guide for all investors – new and old. Let’s start with the basics.

What are mutual funds?

A mutual fund is an investment vehicle where an AMC (asset management company) pools the capital of several investors. The pooled money is further invested in different securities such as stocks, bonds, money market instruments, etc. A fund manager professionally manages the fund and invests it in a myriad of investment options according to your financial portfolio. These fund managers are mutual fund experts that hold an in-depth understanding and knowledge of the volatile markets. In return, the fund houses charge a minimal expense ratio i.e., the annual maintenance fee to manage your mutual fund investments.

How to invest in mutual funds in a way that it best suits your financial needs?

Following are some of the points to be considered before you decide to invest in mutual funds online:

  1. Investment goals
     Before deciding to invest, you need to evaluate your financial goals, risk appetite, and the investment tenure for which you desire to stay invested. An investment objective aids in determining the macro-level assortment of mutual fund schemes. Your investment tenure has the potential to have a contributory impact on your investment decisions.
  2. Performance of the mutual fund scheme against a benchmark
     A benchmark index is a standard against which the performance and stock allocation of a particular mutual fund scheme is compared. It guides the investment philosophy of the scheme. Hence, the asset allocation of a benchmark index must match with the investment objective of the mutual fund.
  3. Consistent returns
     An ideal mutual fund is the one that harvests, desirable, consistent, and significantly high returns over a period and not just whirlwind gains. It must be able to offer decent and consistent returns in both bullish and bearish markets.
  4. Expense ratios
     An expense ratio is an important factor to consider as they have the potential to take away a considerable chunk of your earnings. A reasonable expense ratio is anywhere between 0.5 – 1.5%. Anything above 1.5% is usually considered as a high expense ratio. As a thumb rule of investing in mutual funds, the higher the asset under management (AUM), the lower will be the expense ratio, and higher will be the take home earnings.
  5. Fund manager’s experience and expertise
     A fund manager plays a vital role in the performance of your mutual fund scheme. Although investing in mutual funds is a process-oriented approach, the fund manager has the final say. As a result, their view counts and experience should be accounted as well.

With different types of mutual funds available to individuals, you must remember that no single scheme or a set of schemes is suitable for everyone. So invest in mutual funds that best complement your portfolio. Happy investing!

 

Digital Marketing Tips For Small Business

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Whether or not your small business is digitally based or brick-and-mortar, digital marketing is crucial. The speedy development and growing dependency on technology has made digital marketing arguably the most effective way to spread the word about your business.

It’s more important than ever before to refine your operation’s approach to digital marketing. Make the most of a grand opportunity, and check out a few helpful digital marketing tips for your business today.

Optimize the design of your business website

Your business website is one of your most useful tools in digital marketing, but you have to be mindful of how you formulate your design. Not only do you have to hold the attention of web users, you also have to champion the search engines to be seen in the first place.

Be meticulous about your design, and the response will be your reward. For instance, keyword usage is paramount in placement in the SERPs (search engine results pages). This digital gun store sells AR-15 rifles, and there’s no way to mistake the purpose of their pages.

Google has some useful tools

Google has lots of free tools for business owners to refine their digital presence. Google Analytics will help you see what’s working and what’s not.

A Google My Business listing will boost your local marketing efforts, and there are many other digital tools to explore. Don’t pass on Google’s offer to make your digital marketing efforts more productive.

Build a blog with SEO in mind

Search engine optimization is vital to your visibility online. Take the time to research the ins and outs of SEO, so you can build digital content that indexes well when users search terms that are relevant to your business.

Start your efforts by making certain that all of your content is formatted to perform well for mobile users online. Mobile optimization should be a standard for your online presence.

Social media marketing is essential

Your social media approach should also be a calculated action. Do the research necessary to nail down your target audience, and then work to find out which social media platform best suits that target audience.

Learn what it takes to create a busy social media presence. Start by making regular posts on your profiles. Be present, and answer followers when they make comments on your pages. An active social media presence is a growing social media presence.

Leverage your email mailing list

Use your website and your social media pages to present users interest in your business with an opportunity to opt-in to your email mailing list. Use your email mailing list to build a lasting rapport with consumers, and work to personalize your email correspondence as much as possible.

 

5 Jobs Where You Can Work For Yourself

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Whether you’re seriously contemplating resigning from your current job or looking for ways to earn extra income, you enjoy a higher level of freedom and flexibility as a professional when you opt for self-employment than if you were working for a company.

One major advantage that comes with being self-employed is that you can create and grow your own opportunities. Sounds like an enticing prospect? Let’s look at the top five online jobs you can explore when you take the leap from 9-5 to self-employment.

1. Life Coach or Mentor

You are your own boss as a life coach. You can provide people with practical business coaching in your area of specialisation.

You may also choose to mentor professionals and organisations on how to maximise available resources best to create outstanding values that can help get them ahead in their market or niche industries.

But it’s important you have achieved considerable success in your field before being a guide and mentor to other people. Your records of achievement will attract young professionals. Work teams and organisations seek you out for business or professional training.

2. Blogging

Gone are the days when blogs are basically about telling your life stories to random people on the web. Now, you can make a good living quitting your day job to become a full-time blogger. You just have to find and concentrate on a niche that comes naturally to you and you find fun writing on – from food to parenting, home decor to technology, sports to music etc.

Once your target audiences are able to connect with your blog content and general style and gain wide traffic, you’re likely to start earning lots of money as a blogger from targeted advertisements.

3. Freelancing

As a freelancer, you can select jobs that suit your skills and schedules best. This means you pick only those jobs that interest you and you’re comfortable with. If you’re a great writer or graphic artist, for example, you can just register or log in to a freelancing site and find jobs that match your skills online. It is important that you first get all the basics on how to start working freelance.

However, note that building a great profile and trust with clients don’t come overnight. You need to work hard at consistently delivering quality jobs and on time too. You may even need to start with low hourly rates and scale up gradually as you expand your profile and gain wider experience and clientele.

4. Digital Marketing

If you’ve got a background in digital marketing, then you should seriously consider venturing into Search Engine Optimisation (SEO) when you decide to go solo.

Businesses are constantly in need of SEO experts to help them increase web presence in today’s digitally driven world. The Bureau of Labor Statistics pegs the average pay for a digital marketer at $132,000 per annum.

In addition to helping businesses set up and implement effective SEO strategies, as an SEO specialist, you can also help them market their business on social media (social media marketing).

5. Online Surveys and Product Research

Online surveys and product research is one of the easiest ways to make money fast today. While payments by survey companies and sites vary, the fact is you earn money by simply answering a few questions, surfing the web or some other requested online activities.

You can find and complete different surveys all through the day from your computer, phone or other connected digital mobile device and get rewarded for sharing your opinions.

Conclusion

There are several ways you can be self-employed. The chance to earn from the web could just be what you need to work for yourself.

Whether you want to devote just a part of your weekdays or weekends to it as a side gig to earn extra savings or you want to become a fully engaged, work-from-home professional, you’ll find that online jobs give you that level of freedom and flexibility that traditional workers cannot experience.

3 Tips For Prioritizing Your Marketing Budget When Funds Are Limited

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Every small business owner or entrepreneur knows how vital it is to spend their money wisely. Especially when it’s such a fine line between having enough money to keep everything moving and running into the red, knowing how to prioritize your money is key. So when you know that you need to devote some money to marketing but you don’t have much to go around, prioritization is going to be your lifeline.

To help you in figuring all of this out for your organization, here are three tips for prioritizing your marketing budget when funds are limited.

Work From Your Goals

When trying to prioritize how to spend your money on marketing, the best way to get your head around things and figure out where your money will have the biggest impact for you is to really nail down what your goals are for your marketing in general.

According to Brian Morris, a contributor to Business2Community.com, businesses like law firms might want to attract new clients. For other businesses, getting repeat business or making more sales could be the goal of their marketing. But until you’re able to clearly understand and define what you want your marketing efforts to achieve, you can’t hope to be able to prioritize where you’re putting your money in order to most effectively reach your goals.

Learn How To Best Run Campaigns

Just throwing your money into the category of marketing won’t do you a lot of good, especially if you don’t have a lot of money to go around. In this situation, you’ll want to be very strategic about where you’re putting your money and what’s going to give you the best return on your investment.

To help you with this, Keith Bendes, a contributor to Forbes Communications Council, advises that you allocate your marketing money to whatever is going to give you the biggest impact. Usually, this will mean putting your money only into one channel for any given campaign. So whatever area or platform you think will most resonate with your target audience for that specific campaign is where you should be putting your funds.

Invest Time Rather Than Money

When money is low, there are still ways that you can get your marketing going by investing your time rather than your dollars.

One great way to do this, according to Helen Pollit, a contributor to Search Engine Journal, is to get creative with your online marketing. While you may know the best practices for things like SEO, nitpicking all the little technicalities may not be the best use of your time. Instead, do what you can to set yourself apart from your competitors and make a splash with your audience.

If your marketing budget is small, consider using the tips mentioned above to learn how to prioritize your efforts and investment.

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