No one wants to think about the time we are gone, but it is the inevitable end of things.
People make the mistake of not paying for life insurance because of this denial and the thought of death. But, in fact, life insurance may provide you with reassurance and comfort, knowing that your loved ones will be safe in this situation.
Typically, for most of us, life is indeed a chain of milestones that may cause us to think about the future, and we just cannot help but think about what will happen to the people we leave behind.
There is a great possibility for your family and kids to become financially responsible for the debts or expenses including childcare costs, funeral, mortgage, medical costs, and care costs.
On the other hand, even if you never had some outstanding debts, you would just prefer to leave some legacy to your family and keep them safe after you’re gone.
Whether you wish to leave $5,000 or $500,000 to your family, making the provision earlier in life will ensure you have the peace of mind you have long wanted.
So, we have prepared the top reasons why you would need life insurance.
Do I Really Need Life Insurance?
This is a natural question if you have ever considered getting life insurance in the first place. One way to determine if you will ever need life insurance is to estimate your financial contributions and obligations and what would affect your loved ones after your death.
So, if your expenses are not mitigated by death in service policy, income, salable assets, investment, pension plan, or savings, then you will certainly like to consider getting life insurance.
Let’s say you live in Florida. When it comes to Florida life insurance, it is a legal agreement between an insurer and an insured that provides a death benefit to designated beneficiaries in the event of the insured’s passing.
Moreover, you will have access to those funds while still alive thanks to living benefit provisions. For instance, the insured will be qualified to use the death benefit to treat a terminal illness if it is diagnosed during the policy period.
There are many things to think about, including taking out a mortgage, which leaves you in a position of lengthy and great financial obligation, or your children having chosen to attend a fee-paying school.
Besides essentials, there are a huge number of other contractual expenses such as running a home, raising a child, and insurance policies, which are plenty of living costs that you can unwillingly overlook.
When you take into consideration all of the factors and debts and find out that you have little-to-no provision for your family after you are not around anymore, life insurance becomes a decision demanding second thought.
People Go for Life Insurance When Buying a New Home
Buying a new home is a serious life milestone that takes a lot of responsibility on its own. You always need to think about the unexpected, and sudden death is more than possible in the life of every human being.
So, if your mortgage is not repaid during your lifetime, then the responsibility of paying the rest falls upon the person you love. Life insurance allows you to be proactive when it comes to financially ensuring those you love the most.
For instance, if you have an interest-only mortgage on the line, it would be ideal to choose level-term life insurance. This is the type of insurance where payouts are fixed, and the policy is active for a predetermined amount of time.
The advantage of this policy is that your family will receive the same amount of money regardless of whether you died a year before the policy expired or a year into your policy.
Marriage is a Common Reason
Life is full of different challenges, and establishing your own life with your partner is certainly one of them.
So, if you have recently become engaged or even married, your life will become much easier if you know that your partner is financially safe and sound in case of an unfortunate string of events.
Hence, life insurance will help you financially contribute to your spouse’s well-being once you are not together anymore. You have two types of policies to choose between: single and joint.
A single insurance policy covers only you, while a joint policy covers both your spouse and you. In addition, a joint policy is usually cheaper than just purchasing two single policies.
On the other hand, two single policies normally pay out once. If you make a policy claim, then you are no longer covered, which means that the surviving partner would take their own policy after that.
There are both advantages and disadvantages to these policies, but it is important to remember that joint policies cannot be broken down.
It is impossible to divide the policy into two single policies upon the death of one of the partners.
Having a Baby is an Additional Reason
Having a new family member is always a huge reason to celebrate life and definitely the greatest responsibility for the individual or couple.
To be honest, raising a child is quite expensive, even before supporting them for education and future plans.
Fortunately, because of the wide variety of insurance policies, your child is safe until they reach maturity or even after they turn 18. It depends on what “maturity” means to you.
Ensuring your child’s future will provide you with unmatched peace of mind knowing that your child is safe once you are gone, allowing you more freedom to enjoy present moments with them.
Level and increasing cover term insurance are the types of policies that will pay a lump sum of money if you die within a predetermined term.
If you choose to leave money to your kids instead of paying the debts, then it would be good to consider these two policies.
Life insurance is always a good thing to give thought to, especially if you know that you do not have some particular provisions to leave to the family once you are gone.
So, choosing the most suitable life insurance policy will help your family be financially stable for a while once you are not there anymore.