Want to save tax? Go with term insurance

I've been closely observing savers and investors for almost three decades now, and even though the typical Indian saver is now much more savvy than earlier, choosing insurance still tends to be a blindspot. Most of them usually end up buying whatever insurance policy is peddled to them by an agent in their bid to save tax under section 80C before the 31st March deadline. Section 80C allows a deduction of up to Rs 1.5 lakh from our annual income for taxation purpose. In the last-minute rush, we often choose buying unsuitable insurance products. However, with a little bit of knowledge and forethought, this problem is not at all hard to fix. Given the wide range of life insurance products available in the market, picking the right insurance policy on your own might seem complicated and overwhelming. But that need not be the case. Because the only type of life insurance policy that you really need is a term plan. What's more, it fetches you tax exemption too. But before diving in further, remember that saving on taxes shouldn't be the prime driver for buying insurance. You must first evaluate your need for insurance. If you have dependents, you must buy it irrespective of whether you have any exemptio

This article was originally published on January 06, 2020.