Why Would I Need Life Insurance

If you have worked hard to establish a solid financial -investments,home equity,a savings plan,retirement accounts – life insurance is the foundation that supports it all.
It can guard against your loved ones being forced to make drastic changes to future plans when you die.Some types of life insurance even have built in cash accumulation features that can help with savings goals.

Life insurance can for every stage of  life…

* You’re married
* You’re married with kids
* You’re a single parent
* You’re a stay-at-home parent
* You have grown children
* You’re retired
* You’re a small business owner
* You’re single

To help to understand how life insurance might apply to your particular situation, Have a look  at number of different scenarios below. So whether you’re young or old, married or single, have children or not, take a moment to think about how life insurance could fit into your financial plans.

You’re Married

When you’re married, you share everything with your significant other, including your financial obligations.Most people mistakenly believe that they don’t need to think about life insurance until they have children. Not so. What it one of you were to die tomorrow? Even with the surviving spouse’s income, would that person be able to pay off debts like credit-card balances and car loans, let alone cover the monthly rent and utility bills. If you’re planning to have children, you should buy life insurance right away and not wait until the mom-to-be is pregnant. A lot of companies won’t issue a policy to a woman during her pregnancy. Since health complications can sometimes arise, they’ll want to wait until after the baby is born to issue the policy. Buying insurance before a baby is on the way helps avoid this potential problem.

You’re Married With Kids

If you died suddenly, could your family maintain their standard of living on your spouse’s income alone? Probably not. Life insurance makes sure that your plans for the future don’t die when you do.

You’re a Single Parent

As a single parent, you’re the caregiver, breadwinner, cook, chauffeur, and so much more.With so much responsibility resting on your shoulders, you need to make doubly sure that you have enough life insurance to safeguard your children’s financial future.

You’re a Stay-At-Home Parent

Just because you don’t earn a salary doesn’t mean you don’t make a financial contribution to your family. Childcare, transportation, cleaning, cooking and other household activities are all important tasks, the replacement value of which is often severely underestimated.  Could your spouse afford to pay someone for these services? With life insurance, your family can afford to make the choice that best preserves their quality of life.

You Have Grown Children

As the years go by, you may feel your need for life insurance has passed. But just because the kids are through college and the mortgage is paid off doesn’t necessarily mean that Social Security and your savings will take care of whatever lies ahead. If you died today, your spouse will still be faced with daily living expenses. What if your spouse outlives you by 10, or even 30 years, which is certainly possible today. Would your financial plan, without life insurance, enable your spouse to maintain the lifestyle you worked so hard to achieve? And would you be able to pass on something to your children or grandchildren?

You’re Retired

Did you know that depending on the size of your estate, your heirs could be hit with a large estate tax payment after you die (45% of your estate). The proceeds of a life insurance policy are payable immediately, allowing heirs to take care of estate taxes, funeral costs, and other debts without having to hastily liquidate other assets, often at a fraction of their true value. And life insurance proceeds are generally income tax free and can be arranged to avoid probate. Finally, if your insurance program is properly structured, the proceeds from your life insurance policy won’t add to your estate tax liability.

You’re a Small Business Owner
Besides taking care of your family, life insurance can also protect your business. What would happen to your business if you, one of your fellow owners, or perhaps a key employee, died tomorrow? Life insurance can help in a number of ways. For instance, a life insurance policy can be structured to fund a “buy-sell” agreement. This would ensure that the remaining business owners have the funds to buy the company interests of a deceased owner at a previously agreed upon price. That way, the owners get the business and the family gets the money. To protect a business in case of the death of a key employee, “key person insurance,” payable to the company, provides the owners with the financial flexibility needed to either hire a replacement or work out an alternative arrangement.

You’re Single
Most single people don’t need life insurance because no one depends on them financially. But there are exceptions. For instance, some single people provide financial support for aging parents or siblings. Others may be carrying significant debt that they wouldn’t want to pass on to family members who survive them. Insurability is another reason to consider life insurance when you’re single. If you’re young, healthy and have a good family health history, your insurability is at its peak and you’ll be rewarded with the best rates on life insurance. If you anticipate a need for life insurance down the road (e.g., you’re the marrying type) and you can fit the premiums into your budget, it might make sense to lock in coverage while you’re young and single. Doing so can eliminate the worry of having to qualify for coverage when you’re older and maybe not as healthy as you once were.

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