The Smartlyf

Family . Health . Wealth

Top 5 Questions to ask before taking a Savings Plan with an Insurance company.

We all want to have the extra money to buy what we want, when we want it. Sometimes this may not be possible due to irregular flow of income or other financial challenges.  Whether Wealthy, rich or broke we all desire to have more and more of money each day. Why have less? Why have just enough? Why not have it all? 

We want to achieve our financial goals without breaking our backs or getting restless overthinking about money, thinking of how much we want more of it right now or in the near future. Also, we want to save the extra buck in our wallet to ensure we buy the things we want, make meaningful investments and save for the rainy day. And for those who have more money right now, no one wants to be labelled the famous prodigal son who squandered all his money and ate with pigs. The more the savings plan you have the more the merrier!

There are many savings plans available in Kenya and insurance Savings Plan is one of them. Below are top 5 questions to ask yourself before taking one.

What is my financial goal?

It is important to list all your financial goals in order of priority. Do you want money for your kids’ education, buy property, save for retirement or just accumulate the money then decide what to do with it afterwards?

When would I like to achieve your financial goals?

The best financial goals have a timeline. Remember S.M.A.R.T goals? This will help you achieve them faster by getting committed and keeping yourself in check.

What is the rate of return?

A savings plan is not a get rich quick scheme strategy, the essence is to help you put money aside and for your future. Interestingly, insurance companies offer returns on your savings which keep on increasing with the period of the savings plan. In Kenya, some companies offer up to 50% return on savings for plans over 10 years.

What additional benefits am I looking for?

Insurance companies tend to offer additional benefits such as Life coverage, waiver of premiums in case of death or disability due to accident or critical illness. This means that you immediately stop contributing while your savings plan continue to accumulate. This will guarantee 100% payment of the maturity amount. For example, if you were saving towards 5M and you became incapacitated due to accident or critical illness or worse passed on,  you or your beneficiaries would receive the full maturity amount even if you had made only 1 contribution (As per terms and conditions of your contract)

Which is the best insurance company?

When considering the best insurance company in Kenya, ensure it is of good reputation, their leaders are of good repute, they have enough experience working in the market and offer good service. Most importantly find out what people are saying about them online.

It is important to note that your accumulated funds would not be subjected to taxation.  Remember to work with an experienced Financial Consultant who will help you with all your Saving Plans questions and guide you through the process.

How to choose the best Education Plan/Policy for my child

Being a parent is the most beautiful thing, and you are never alone in your thoughts. You are constantly thinking about your kids, the memories you create together, their day-to-day needs as well as their future needs. We all want our children to have the best childhood, access the best things in life, and more importantly, we hope to be around and see them grow into fine adults. Education is a primary need for our children, and we all do our best to help them access quality education from kindergarten through to higher education levels. 

I know you have heard about education plans and policies, and there is that one agent who keeps calling you every other week requesting an appointment to sign you up with one and you keep wondering, what is this hype about education policies? Do I really need it? Of course, these reservations are normal, especially when making any financial commitment.

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Why do I need a home insurance/Domestic Package?

We put a lot of effort into creating a space to live in. A home is our safest place where we get to relax together with our loved ones after a long day. We go out of our way to purchase valuable items that provide comfort to us, our loved ones, and our guests. We constantly improve our living space by upgrading that sofa, buying the latest electronics, and giving our kitchen a facelift. Our home is our pride. 

Imagine getting home one day to find your house up in flames or all the contents stolen? I remember one Saturday in January 2021 I woke up to find all our electronics missing, TV, Laptops, Phones, and my husband’s treasured bike. I couldn’t believe it! Someone had crept through the toilet window and made away with our treasured items. We are thankful to have had good insurance in place.

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What is covered under NHIF?

Your health is your world. Being in good health is the most valuable treasure. No amount of wealth can compare to good health, and no amount of money can buy good health. Being healthy helps us to enjoy life better, create memories with our loved ones, enjoy our hobbies, and stare into the beautiful sunset as we plan our future on how to bring our dreams into reality. 

Isn’t it a beautiful feeling to wake up in great health and enjoy the beautiful breeze? Sometimes, even after eating healthy, exercising, and getting enough sleep, we still fall sick and need to access medical care. There are various medical insurance plans available in the market which you can choose from depending on the limits you may require and your budget (we shall discuss them in another forum).

What is NHIF?

The National Hospital Insurance Fund is a state corporation with the directive to provide affordable medical insurance coverage to all registered members, including their dependents. It covers both inpatient and outpatient services, but the limits depend on your type of cover.

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Tips for choosing the best company for your car insurance

Having a car makes life easier, from taking your kids to school, going to work, and even taking that exciting road trip. Imagine the inconvenience of having your car being stolen, getting damaged, or causing damage to another person’s property, worse hitting someone? Yeah, it’s not a funny thought. These fears lead us to purchase motor insurance not forgetting that basic insurance (Third Party Only) is a legal requirement in Kenya. 

In Kenya, most people purchase insurance through a broker or agent, and some are not aware of their car insurance company. What would you do after a car accident or theft after realizing you know very little about your insurance company?  Consider the following before arranging insurance cover for your vehicle.

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Should I invest money in a Money Market Fund (MMF)?

I receive this question from my clients every other day and am glad to discuss MMF today. We shall see its importance and superiority compared to other forms of investment. By the time you finish reading today, your eyes will be wide open and you’ll know what to expect. There are no shortcuts to getting rich, it’s all about consistency, understanding products available in the market, working with a great investment expert, and having clear financial goals so that you are able to focus on investments that match your financial plans.

Due to the rising instability in the economy like the COVID-19 Pandemic and political uncertainty, most investors are focusing on investments that provide preservation of their capital, such as fixed bank deposits, low-risk bonds, SACCOS, Plots, or Money Market Funds. These provide safety for their investments in comparison to the fluctuating securities markets and provide a potential stable rate of return.

So what is a Money Market Fund? It is a form of Unit Trust Investments whose aim is to deliver interest beyond the existing inflation rates.

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