Who Needs Life Insurance?
Life insurance is one of those things that many people know they should probably have, but they don’t make it a priority. If your spouse, children or a loved one depend on you financially it’s time to move it to the top of your “to do” list.
Getting life insurance can be overwhelming. Many people are uncertain about what type of policy is the best for the situation, or they are uncertain about how much life insurance they need. And what about your children? Do they need life insurance too?
Here are some answers to questions about life insurance.
Why do you need life insurance?
There are many answers to the question of why life insurance is important. The most important reason is protecting your family with financial security and peace of mind. If your family or loved ones depend on your income, they would most likely struggle if you were to pass away.
There are different types of life insurance policies, but no matter which policy type you choose there is a death benefit paid your beneficiary when you die. Money from life insurance can be used to pay for living expenses, a mortgage or rent payments, loans, college tuition and other essential expenses.
Who needs life insurance?
Married or partnered couples
Many partners find it difficult to pay living expenses when they no longer have income from their spouse or partner.
Married or partnered couples with kids
In addition to paying for all living expenses without that second income, the surviving parent may have to pay for childcare and more without the other parent around to pitch in.
Single parents
Life insurance can replace your child’s only source of financial support after your death.
Stay-at-home parents
Stay-at-home parents perform many critical responsibilities that would be costly to outsource if they passed away.
Children
Life insurance is inexpensive for a healthy child. A universal life or whole policy not only provides a death benefit, but also accumulates cash value overtime. When you child becomes an adult you can make them an owner of the policy allowing them to keep it for the death benefit or taking out the cash value to use the money for other means. By getting life coverage young, you also have a policy established in the case that your child later develops a disease or illness that makes them ineligible for life insurance.
Do you have children that attended college with student loans? Life insurance can provide loan payment for outstanding loans that a parent has co-signed on. In the event of your child passing, you would have the death benefit to pay off their student loan that you become responsible for paying
Retirees
Money from life insurance policy gives heirs access to tax-free money to pay for a funeral and other costs.
Business owners
Life insurance can help your business in many ways if you, a fellow owner or a key employee were to pass away
What are the different types of life insurance?
Term Life
Coverage for a specific amount of time. It is often 10, 20 or 30 years.
Universal Life
Flexible coverage that can be adjusted to meet your needs.
Whole Life
Permanent life insurance provides lifelong protection for your long-term needs. It provides a death benefit, but it also accumulates cash value which you can tap into to for things such as buying a home, supplementing your retirement income, covering an emergency expense and more.
