What is a Life Insurance Retirement Plan and Why Do You Need One?
This product allows to accumulate capital (reserves) until a certain age (for example, until 60 or 65 years old) by saving 10-15% of their income over a specific period of time while they are working. Additionally, the program provides reliable insurance coverage in case of injury to the client or financial support for their loved ones in the event of the client's death due to a car accident or other unfortunate circumstances.
We all understand that retirement age is a time when a person may not be able or willing to work anymore, and ultimately, it's a period for well-deserved rest after 40-45 years of active working life. This period is guaranteed to come, whether we want it or not.
Against the backdrop of a pension fund deficit and the realities of today's retirees, each of us surely and honestly realizes that we desire a different standard of living in retirement. We're already different from you!
The question is, besides acknowledging this, are we already taking action?
The key to an independent financial future is in our hands – save just 10-15% of your income during your active working years – and you'll be surprised: by the time you reach 60-65, you'll have significant capital of your own, which will multiply many times over due to compound interest over such a long period.
Can I afford to have such a product?
Why not? The main rule is to save 10-15% of your income and do it regularly (consistently). Form a financial habit – pay yourself first, don't spend it all! And it doesn't matter how much you earn, whether it's 6,000, 12,000, or 30,000 hryvnias. The important thing is to save a portion of your income for YOURSELF! The choice is simple: either build your reserve independently and have your own pension capital, or rely on state support - state pension. But it's not guaranteed that it will be enough in our future.
Lately, we've been hearing and seeing more and more on television about the significant deficit in the pension fund, leading to low pension payouts for current retirees. This deficit has arisen due to a number of objective reasons: for decades in Ukraine, there has been low birth rates, and the number of people in the workforce (whose contributions fund the pension system) equals the number of retirees.
Moreover, this statistic worsens each year: in a few years, we will see an even bleaker picture – one worker will be supporting two retirees; part of the population works abroad, while another part earns income unofficially, meaning taxes are not paid to our state, and so on.
The conclusion is clear - the solidarity system is outdated, unable to fulfill its functions, and inefficient.
We also see that the retirement age is increasing, and there are additional requirements for receiving state pension benefits such as the insurance tenure. We can talk about it for a long time, but the year 2028 will clearly "open the eyes" of all Ukrainians when the first non-payment of state pensions begins. Yes, precisely those - the minimum! Because many will not have accumulated 35 years of insurance tenure when retiring. And whose responsibility will it be then? Ourselves!
So does this indicate the inevitability of independently arranging savings programs? Obviously! Count on yourselves ;)
Let's take neighboring countries as an example. Do you think that retirees in those countries are cared for more? No, they are cared for in the same way as in our country. The fundamental difference between our pensioners and European pensioners is that the latter prepared for their retirement age themselves. That is, they formed reserves for themselves for the third period. Whereas our pensioners stubbornly and without alternatives rely on someone else – the state, children, etc.
Today, every working-age person can have this product regardless of their income level.
Moreover, it's simply necessary because there is no alternative! A life insurance pension program is the only product that combines elements of capital formation and health-related protection.
But if you still feel that it's "too early to sign up," "later," "I'll handle other financial matters first – like buying a flat, a car, etc., and then somehow later..." I won't try to convince you, I just want to point out: "TIME is generally difficult to measure or evaluate, it can only be marked on a calendar." Remember yourself or situations from 5 or 10 years ago, and it feels like it was just yesterday, doesn't it? In exceptional cases, time works in our favor, but not in this case :)
I wish you wise and correct decisions! Time waits for no one, and I don't recommend it to you ;)
