No one can erase the emotional pain that accompanies death. Though there is a way to erase the financial pain: life insurance. The idea behind life insurance is that it replaces the income of the deceased. Thus, the emotional pain of death may remain, but the financial concerns can be relieved.
Life insurance is especially important for those with dependents. Let’s say you earn $50,000 per year. What would happen to your dependents if you were to die? How would they remain financially secure? A good life insurance policy would replace your income of $50,000 per year. Then, financially speaking, your dependents would be okay.
If you don’t have dependents, it may still be a good idea to take out a policy. Your spouse, for instance, could keep the same lifestyle after you pass. Even if your spouse or dependents could support themselves in time, life insurance will make the transition after your passing easier. Life insurance can keep them on track, covering household expenses,college savings plans, retirement savings accounts and other goals.
Tips for Choosing an Appropriate Life Insurance Policy
If you’ve decided you want life insurance for a certain length of time, consider term life insurance. Most people get term life insurance that expires at retirement. At this time in your life, the need for life insurance is lessened. Plus, premiums can get very expensive once you reach senior citizen status. If you always want to have the security of life insurance, consider whole life.
Go with a company that is transparent and makes you feel comfortable. Struggling with a company before the policy begins means there will likely be struggles when trying to redeem the policy. Remember, the goal of life insurance is so your loved ones don’t need to worry about money upon your death. Do what you can to make sure the redemption process is simple.
Consider your premium carefully. If it’s too high, you may resent the coverage and allow it to lapse right before the insurance is needed. Readjust your policy as necessary. Alternatively, keep up-to-date with changes the life insurance company makes. Make sure the plan you bought remains enticing, even as things change.
Make Sure You’re Covered for All of Your Needs
Be sure to ask a prospective company plenty of questions. Feel free to share your current expenses and ask them how much coverage would be adequate. Ask how easy it is to readjust, in the event you decide to pick up a new expense to add to your budget. Ask what the process is like for getting your burial expenses covered. Feel free to discuss everything you learn with your partner/beneficiary. After all, they will be the one dealing with the insurance company if it comes time to collect.
Irregular expenses can also be covered as part of the payout. These include medical expenses prior to death, burial costs and estate taxes.
A good life insurance policy will erase the negative financial impact of death. That said, life insurance may be the most important financial product you ever buy. And since it is so important, it’s essential you choose the appropriate policy. You can shop for life insurance at nearly any age, but consider getting it sooner rather than later.
To make the decision process a little easier, we’ve provided a calculator to help you find the right life insurance.
Overview of How the Calculator Works
The calculator offers a quick way of selecting a life insurance policy. Think of it as a funnel. You input your information, then the calculator filters down to your best options.
The calculator keeps you from having to input this basic information to multiple life insurance companies. Doing that would be inconvenient. First, it’s time consuming. Second, it opens you up to spam emails, robo-calls and other solicitation from insurance salespeople. You don’t need those troubles.
