Life Insurance
Have you been asking yourself the question, “Why do I need life insurance?” If so, there are several valid reasons to purchase a policy. Continue reading to find out why it’s important to buy life insurance.
Easing Financial Stress for Loved Ones
You go to work every day to support your family. Unfortunately, there’s a strong chance that those who depend on you would feel financial strain relatively quickly if you were to die. But they don’t have to.
This is one of the biggest reasons life insurance is important.
Life insurance is designed to provide your loved ones with financial support after your death – support that can act as an income replacement should it be needed.
When you purchase life insurance, you choose the coverage amount. That coverage amount typically varies from a few thousand dollars to a couple million dollars. If you die while your policy is active, your beneficiaries receive a check for your death benefit, replacing the income you would have otherwise brought into your household.
Covering Daily Expenses and Bills
The vast majority of people who purchase life insurance do so as a means of income replacement when they die. The simple fact is that your family faces many day-to-day expenses. Everything from food to clothing, school supplies, and gasoline comes with a cost.
When you pass away, your family will lose your paycheck. Sure, they may be able to look forward to pensions, social security, or other benefits, but those benefits may take some time to kick in, leaving your loved ones to struggle financially until they do. When these benefits kick in, they may not be enough to maintain your loved ones’ current lifestyle.
Life insurance is important because it offers rapid access to funds for your family in the event of your death. Moreover, you can adjust your coverage to ensure it meets all of their financial needs.
Protecting Family Home and Settling Debts
Life insurance is also an option for protecting your family home and your estate. When you pass, lenders will look to your estate to settle any outstanding debts you might have. If you’re unable to pay those debts through your estate, any co-signers will have to pay them for you.
Moreover, say you die with $50,000 in debt and only $30,000 in liquid assets. In this case, your heirs may be forced to sell your family home to cover the difference.
In a worst-case scenario, if you still have a mortgage on your home, it could go into foreclosure if you don’t have life insurance to cover it. Help your loved ones avoid this hardship by purchasing life insurance to cover any outstanding debts you might have.
Funding Education
for Children
As a parent, you want to make sure your children have a leg up in this world, including access to the best education. Unfortunately, education costs are soaring. If you’re not there to help, your children may not be able to affordably access a college education.
This is yet another reason life insurance is important.
Simply get accurate estimates for how much money it will cost to send your children to college. Then, make sure to bake that cost in when you’re considering your life insurance coverage amount to help secure your children’s successful futures.