Beginner’s Guide to Financial Planning In India

Financial planning is the most important aspect of one’s life. No matter how many plans one makes about career, marriage, vacations, children, etc., nothing will work out well without sound finances. It is extremely important to start planning about it the moment one starts working. There are various tools to achieve that including investment in financial instruments as well as insurance policies.

When we talk about regular financial instruments of investment, the most prominent ones are:


  • Fixed Deposits with Banks
  • Equity investments in Shares and Mutual Funds
  • Investment in National Pension Fund (NPS)
  • Public Provident Fund (PPF)
  • Real Estate
  • Bonds and Securities

All these investment vehicles either come with their own share of risks or require big investments from the start itself for them to be of any help. This is not to say that these are not important, or one should not invest in them. In fact, one should diversify their portfolio to gain maximum advantage out of various investments.

However, in this article, the  focus is on insurance policies and how they can make for one of the best investment you’ll ever make. One should consider life insurance plans that offer the best safety and security when you are alive and even after your unfortunate demise. They don’t put a lot of pressure on your pocket, yet provide you with a financial cover, which comes to your rescue during any crisis. The best insurance plans can be like your friends, always to cover your back.

An insurance plan can work for you in following ways:

1) In the case of an untimely death, the family members can be assured of a lump sum amount of the insurance coverage.

2) If the insured is alive and the policy matures, the insured can use the maturity amount along with interest earned on it to fulfil financial obligations like a child’s education or marriage or for any other urgent priorities.

3) Having a health insurance plan would ensure that hospitalisation and other medical expenses are being taken care of while the insured focuses on recovering and resuming regular life.

4) They all provide you with tax benefits to help you save money that can be used to meet other expenses.

These are the main advantages one can derive insurance plans, and if you go into detail, there are many more benefits awaiting for you to make life easier.

How To Buy?

Everyone has different priorities and requirements when it comes to financial decisions of life. No one size fits all. To find out what’s best for you to buy the best insurance plans, it is advised to do your research and select the policy that works for you. No, you don’t have to go from office to office doing your research. Instead, you can sit in the comfort of your home and buy insurance online. Not only you get to have a look at all possible options for all insurance players, but you also get to compare them all and then select the one that offers you maximum benefits, at least, possible cost.

Read our article “Why is Life Insurance not an Investment?” for understanding more about insurance.

The insurance industry in the country is now growing by leaps and bounds, and the government is also encouraging the citizens to get insured. It is to everyone’s benefit to take such rational decisions without worrying about the additional expense it may cause in the short run. Over the long term, insurance policies are the ones, which are going to provide the much-needed help in times of death and medical emergencies.

It is prudent to not postpone these decisions any further. It’s all about financial planning that will help your life go on smoothly.

Harjot Singh Narula

Harjot Narula is founder and CEO of ComparePolicy.com, an IRDAI approved insurance web aggregator focussed on selling online insurance for companies. Harjot has more than a decade of experience in software development and has also spent 5 years in US working for the mortgage and risk management industry.

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