Financial Planning

Financial Planning

Introduction

The resources in the world are limited; so human being has to make a choice between the best. The selection of choice is done by finding out the importance of that good or service for oneself. Thus, financial planning comes into action, which plays a very important part in an individual and group life. Financial planning lets the person to select the required assets and then check the allocation of resources for that particular asset. It also lets the person to manage their assets allocation, life insurance policy, health insurance policy and the debt management.

Life insurance policy

Life insurance policy is a blessing in disguise for the loved one, mainly who are left behind after ones death. These life insurance policies are not as simple as they look they have their terms and condition attached to them, with specific premium for each of the specific type of life insurance. The three main type of life insurance are

Term

In this sort of life insurance people, specific needs are addressed. In this sort of insurance, the person not only gets cheap life insurance quotes but also good rate of insurance if taken at a very early age. This sort of insurance is beneficial for the people who are fulfilling specific financial needs like paying for child education or mortgage (Marlow, 1998). Typical lengths of the terms are 10, 20 and 30 years of coverage, within this period if the person dies than the insurer would pay a handsome amount of money.

Whole

This is the most expensive life insurance of all. This is because three things are guaranteed to the policyholder that is death benefit, fixed premium and cash value growth. Thus, the person who is taking this policy should first look into his needs.

Universal

This type of life insurance requires the most monitoring. This is less expensive than the whole life insurance. This type of life insurance is quite flexible as far as the payment plan is concerned. The schedule of payments does not exist. So to keep the integrity of this policy thus current cash value should be maintained to meet the charges that are made by the insurer. This life insurance is more of a long-term investment.

Thus, I am young person who has a mortgage to be paid. Therefore, I would go term life insurance. This will be rewarding for me in the end too as I am young.

Health Insurance Policy

Health insurance plan are very important for an individual and family. This is because they provide safeguard to the families from the high cost of health related cost, which are to incur in case of any disease or accident. Health insurance policies are of many types but we are going to discuss the three main types of these policies. The Participating Provider options (PPOs), Health maintenance organization (HMO) and consumer directed health plans (CDHPs).

In the Health maintenance organization, people taking the plan have closed panels of doctors. It is the least expensive at the same the least ...