When investing or making any transaction in our day-to-day lives, we aspire to get the best value from that deal. With that in mind, we must also prepare for the worst-case scenarios, in order to not be taken away when something similar to it occurs. A backup is something one must have to help in situations like these and take off some of the pressure. Money back policy is a type of life insurance policy that allows you to avail the benefit of investment as well as protection. A money back policy provides you money at regular intervals while simultaneously insuring you and your loved ones with an insurance cover. 

How to use the money back policy to secure your financial health?

A money back policy provides you with the best of both worlds by providing you returns at intervals and provides you with financial coverage. A money back policy provides you with a plethora of benefits that supplement your income and relieves some of the stress on your shoulders.

  1. The money back policy tool provides you with guaranteed returns, which you can claim once your policy is matured. These accumulated returns can help you in achieving your dreams or providing better times for your dependants. 
  2. If you invest in money back policies at an early age, you will receive higher benefits in the form of bonuses that are added to your policy over the time you are invested in it. 
  3. As discussed earlier, money back policies give you an added advantage over other policies that include a regular sum of money at timely intervals. You will receive this payment once your premium payment period has ended. This sum can act as a secondary source of income stream for you. 
  4. Life benefits are provided to you and your family. This can help you and your loved ones at times when your finances are facing turbulence. When you have policies that support you in similar ways, help you invest better, provide cover to your loved ones and assist in creating a secondary stream of revenue, you are provided with a breathing space that renders you with an opportunity to make such financial decisions that will only bolster your financial health for the better. 
  5. The tax benefits, which you can claim with an investment in money back policy, are just like an icing on the cake. You can claim up to 1.5 lakh of deduction under section 80C of the Income Tax Act, 1961. The benefits which you will receive overtime for investment in this policy are exempted from being taxed as an income under section 10(10D) of the Income Tax Act.

Money back policies provide you with average returns that are sufficient for many people. You should pre-plan an investment in a policy like this. Highlighting your financial goals, targeting a particular level of lifestyle, deciding upon a retirement corpus fund, and imagining a type of portfolio will help you decide better. One of the best ways to secure your finances with money back policies is to start early.