Is living long a risk?
Just imagine, in your retirement phase, after some time your savings can run out and you may need some medicine or hospitalization. At the age of 75 or 80, you may need all these things. Now when you have stopped working at 60 your savings may run out in the next 15 or 20 years.
But you may live for more than 80 years which is now possible due to good medical facilities invented in the medical line. That’s a risk too.
So let’s talk about these two risks: Dying too early and living too long. The great investor of the time Warren Buffet once said, “When you do earning and get your first salary, then before that you invest that money in anything, first of all, take your life insurance because we can cover ‘dying too early’ from here.”
To mitigate this risk, we must obtain life insurance as soon as we begin working, as our families become reliant on us. As soon as you reach adulthood, you marry and take on more responsibilities. After a while, your parents will become reliant on you as well. As a result, it becomes your responsibility to provide all of these with the necessary amenities, particularly in our Indian society and culture. So start with your life insurance and review it as your income and expenses rise. Perhaps you bought your insurance for 50 lakhs and then took it for 1 crore or 2 crores. Perhaps your income increased even more, and your lifestyle expanded. Now you’ll try to instill the same values in your children and parents for the rest of their lives. So you’ll have to increase it to 5 or 10 crores. However, it all depends on how much money we make, how we end up, and how we manage our risk by reviewing it. So that’s the first risk about which we talked earlier.
The second is now living for too long. Yes, living a life that is too long is a risk. So, what are our options for dealing with this? Warren Buffett advises that once you begin earning money, you should begin saving for your pension, which will assist you after you retire. It might not be a passion, but you could be putting money aside for retirement. Perhaps you’re demonstrating a passion for a regular income after you retire at 60 or 65 years old, or whenever you decide to retire.
So these two things happen to coincide, and both are significant in our lives.
The sooner you start preparing, the better.
