Since young, we have all been taught to adopt the habit of saving money wherever possible. Saving money is one of the fundamental aspects of building up wealth and securing financial future, and it is best to start while we are still young.
Savings do more than just give you a head start to securing a solid financial future. Not only is saving the first step to building your financial wealth, it also acts as a financial safety net for emergencies. By systematically and periodically putting aside some money for savings, you can steer clear of or easily overcome any obstacles you may encounter. But when it comes to saving money, how can a person know when they are ready to take their savings to the next level by getting a savings insurance plan?
Apart from discipline, there are a few other prerequisites, such as a stable income, deep commitment, and a profound understanding of one's needs and goals based on their current life stage.
Why is savings important?
Everyone must set aside some savings regardless of their spending habits, earnings, and life stage. Below are only some of the reasons why you should start saving as early as possible:
- Enjoy peace of mind
You will have a financial safety net to fall back on in times of need to help you pay for unexpected bills beyond your normal living expenses, providing you with peace of mind since you have prepared for the unexpected.
- Helps plan your short term goals
Savings are not exclusive for the long term; you can save for enjoyment in the short term, such as for a well-deserved vacation.
- Secure a better future
Your savings can be the solution to your life goals, whether to buy a home, purchase a vehicle, or as a supplement to your retirement plans on top of your retirement insurance. By adopting good saving habits, you can easily secure your future so you can indulge and enjoy yourself in the present.
- Gives your loved ones the financial security in case of an incident
Savings not only helps you but your family as well. Being disciplined with your savings also guarantees that your family is well-provided and can overcome any financial difficulty if an unfortunate event befalls you.
What are your savings goals?
Having goals for savings is one of the keys to developing a consistent and disciplined savings routine and becoming committed. As such, if you have these goals already sorted out, taking a savings insurance plan can help you efficiently achieve them. Take for instance, your child's education. If you can foresee financing their college education in ten years, you can better choose a plan that comes with a maturity benefit before that time comes. Or suppose you are saving for your retirement a couple of decades from now. In that case, choosing a plan that matures close to your desired retirement age with higher returns could potentially let you maximise your savings within your timeframe.
Have you successfully paid off any high-interest-rate debt?
Debt has become part and parcel of modern life, be it from taking a loan to buy a home or a personal vehicle. The greater the loan, the more money you will owe the lender as interest mounts up over time. Repaying high-interest loans may nullify all your attempts to earn interest in a savings insurance plan. Thus, it is recommended to first pay off any outstanding debts before getting into other financial commitments.
Do you have a healthy emergency fund?
Finance experts talk a lot about emergency funds – savings that help you tide over financial ruts like losing your job, a recession, or unexpected medical expenses. Having a healthy emergency fund is a positive indicator that you are ready to dive and commit to a savings insurance plan. Without it, you may be forced to expend your savings plan in case of an emergency, wasting all your efforts as you go right back to square one.
What is savings insurance?
Savings insurance plans are financial products that you buy to increase your savings over a fixed period. For instance, if you purchase a three-year savings plan, that means your money will be locked up for the next three years. At this time, taking out your money will incur a penalty for early withdrawal. This works similarly to how fixed deposits operate in a bank.
Some savings insurance plans offer guaranteed capital. Compared to investment, savings insurance is a more conservative and fuss-free financial vehicle that grows your wealth for tomorrow.
China Taiping Insurance (Singapore) offers a selection of savings insurance plans to suit different financial situations and personal needs, such as:
- i-Save: A short term three-year savings plan consisting of guaranteed maturity returns with just a single premium commitment
- i-Saver8: An eight-year savings plan that requires only two years of premium payments. When your insurance matures, you can earn up to 3.13% p.a.. Not only does this plan allow you to save, it also protects you and your family in the event of an unfortunate death event.
- i-WealthSaver: A savings insurance plan that provides you the flexibility to grow your wealth for your various needs at all life stages.
- i-CashLife: A whole life and savings insurance plan which provides attractive guaranteed yearly cashbacks of up to 3.95% p.a.of the Total Yearly Premiums right after the end of your selected premium payment term until age 120. You will also be rewarded with a guaranteed loyalty cashback equivalent to 1x Guaranteed Yearly Cashback on the 20th policy anniversary and every 10 years thereafter.
Savings are a vital component of our life, and it is never too late to invest in a savings insurance plan and get started on working towards your life goals and dreams. After all, when you start to save now, you are saving your future. Get a head start on becoming free from financial woes and fully enjoying life's endless possibilities today by purchasing a savings insurance plan that best caters to your needs.Download PDF