Having life insurance may seem like an inconvenience or unnecessary expense to some, but it can provide vital benefits that make the investment worthwhile. Whether you have children, a spouse, or other family members who rely on your income to survive, life insurance could be just what you need to maintain the lifestyle you want them to have. Here are the top five benefits of having life insurance and why it would benefit you.
Prepare Your Loved Ones
Nothing is certain in life but having a policy in place can help protect your family’s financial future. If you’re married, life insurance is typically tax-deductible for you, unless you have an employer-provided plan, so there may be a financial incentive to purchase one. Plus, if your spouse loses their income because they take time off to care for children or aging parents, having coverage will give them peace of mind that they’ll still be able to take care of basic expenses like utilities and car payments. In addition to these practical benefits, being prepared means your loved ones won’t have any “what if” worries. They will know they are taken care of in case something happens to you.
Replace Lost Income
Whether you’re single or have a family, life insurance can help replace lost income after death. There are two main types: Term Life insurance provides coverage for a set period, usually 10-30 years, while Permanent Life insurance provides protection for your entire lifetime. Term Life is typically much less expensive than Permanent Life insurance but should only be used to fill short-term needs, if there are no beneficiaries who will miss your income. Permanent Life insurance may be necessary if there are other dependents in your family who rely on you financially.
Cover Funeral Costs
Make sure your family won’t be left scrambling to pay funeral costs, or worse, suffering through a financial hardship while they try to come up with money for it. While it can be expensive, life insurance will cover these costs without placing a burden on your loved ones. While you may know that you want some amount of coverage based on your salary and your goals, consider consulting with an insurance professional to find out what level is appropriate for you. Think about potential expenses such as home mortgages and educational expenses for children who are still at home, as well as paying off credit card debt or student loans if you’re feeling particularly conservative. Make sure to revisit coverage levels every few years since life changes, such as having kids, could affect how much coverage you need over time.
Deal With Unexpected Issues
In most cases, buying life insurance is a small price to pay to provide financial security for your family should you die prematurely. And remember, you’re insuring against death, not sickness or accidents. If something does happen, your policy may cover funeral costs, medical bills, mortgage payments, college tuition for your children, or even more insurance to provide them with financial freedom, and other expenses that come up after an unexpected tragedy. A life insurance policy can help take care of anything that might come up when you’re gone, and it can provide peace of mind in case anything happens to you unexpectedly.
Provide Peace of Mind
The number one reason most people buy life insurance is to provide security for their loved ones when they’re gone. Whether you have a spouse, kids, or other family members who rely on your income, losing a loved one is often devastating financially. Getting your finances in order before you die is crucial to helping keep your loved one’s stable following your death. Without proper planning, an unexpected death can leave loved ones struggling financially for years after a loss. While life insurance can never make up for that loss entirely, it does help take care of basic financial needs so loved ones aren’t left with large debts or lots of extra expenses.
With all these potential benefits, everyone should consider getting life insurance.
Have Additional Questions?
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