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News & Views

Wednesday, Aug 23, 2017

Are you ready for your afterlife?

[Source : The Economic Times]

Alarming rise in the expenditure on health and lifestyle calls for mindful financial planning for your life.

List the things without which you won’t leave your house. Your mobile phone, wallet, credit cards, bike keys or car keys, a bag, and of course the attire to match your position at work.

Let’s talk about weekends now. Our Friday and Saturday nights look drastically different from what they used to about ten years back. No weekends are complete without a meal at an upmarket restaurant, visit to spa, or to a sports club.

Things and services, that we called luxuries a few years back are now necessities. The list is only growing longer. Sure, you can choose to live your life without these. But then how would you deal with the stresses of the modern-day life?

Top it with lifestyle diseases and uncertainties of day-to-day living - you have a mind-boggling financial puzzle to solve.

Let’s talk about the fixed (and absolutely) costs first.

Rents: An average two bedroom house in a decent locality will come at a rent of about Rs 30,000 a month.

Education: Reports say that, the spend on education has gone up by a whopping 390% in urban areas in 2011-12 and 433% in rural areas compared to 1999-2000. There Costs of other related items of expenditure, like books and stationery, too have shot up in the past 12 years.

A middle-class household spends a jaw-dropping Rs 55 lakh to raise a child from cradle to college. The primary education sector has seen an alarmin 169% increase in costs over the last few years.

Health and fitness

The other big cost head that takes a fair share of our mind space and budget, is health. This covers everything from usual illnesses to accidents to disabilities, to chronic ailments.

These unpredictabilities are enough to throw your life out of gear and your budget out of hand. Such events raise emergency demands on your funds.

As per recent reports, total family spend on medical bills shot up by 317% in urban areas and 363% in rural areas for institutional care.

Costs of tests are the biggest contributors to this already high cost. The report says that costs of tests increased by about 541% in urban areas between 2000 and 2012.

Another survey conducted by GOQii says, 1/3rd Indians, over 30 years of age, suffer from Lifestyle diseases. 4% people are suffering from high cholesterol, followed by 7.7% with diabetes, and 6.7% with thyroid. Inappropriate food habits, lack of sleep and stress are adding to this already grim situation.

A recent study conducted by Confederation of Indian Industries on Non-communicable diseases says that India is home to 65 million people suffering from diabetes. Both urban and rural areas are witnessing an alarming increase in the number of diabetics.

Save. Insure. Invest.

We know the world we live in and the challenges it brings to us on a daily. So, how does a household ensure they maintain a decent standard of living for most part of the family members’ lives? What’s the magic trick to live a relaxed life now and secure your future? More importantly, how do you ensure your family lives a good life even when you are not earning or when you are not around? The answer to this financial puzzle lies in a balanced recipe of saving, insuring, and investing.

With smart investment and insurance products available these days, it is possible to live the life you want and ensure your kin are taken care of in case of any unfortunate incidents.

HDFC Life’s latest product called HDFC Life Click 2 Protect 3D Plus is one such term insurance product. This plan option covers all three D's- Death, Disease and Disability. It also provides lump-sum benefit on death or diagnosis of terminal illness. Moreover it offers 9 plan options that helps one decide the most suitable option. Although it is a term plan it also provides a plan option called Return of Premium which gives you survival benefit. Another interesting plan is the Whole Life Protection. You pay premiums till the age 65 and get protected your entire life.

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