Planning for vacation is exciting. Planning for a big transition is crucial. Even planning your meals each week can bring some ease to your life. But too often people neglect to spend time planning for the future. Life insurance is one of those too-often-forgotten necessities in life. If you’re wondering how life insurance can help you and whether it’s too late to purchase it, we’re here to clear some things up.
What is life insurance?
Life insurance is there to protect your loved ones in the event of death.
This contract between you and your insurance company helps ensure that your beneficiaries are provided with the financial support they will need after your passing. And they’ll be able to use the funds in whatever way they see fit.
You have the option to name any person(s) or organization(s) that you choose as your beneficiaries. And the amount those entities receive is based on the policy that you hold.
Who needs life insurance?
Life insurance is a necessary safeguard for anyone. Many people wait to purchase life insurance until a major life event – and still, some choose to wait until life expectancy becomes more forefront in mind.
But you should start thinking about it now.
If you find yourself in one of the following categories, we suggest you begin considering how having life insurance can benefit you and your loved ones.
• I am married.
• I have a domestic partner.
• I have a spouse and kids.
• I am the primary breadwinner.
• I am single with kids.
• I own a home.
• I own my own business.
• I have student loan debt.
• I’m retired.
Is it too late for me to buy life insurance?
You should know it’s never too late to invest in life insurance.
Although purchasing sooner can help reduce the costs, the determination of your premium (how much you pay for your policy) relies on both your health and history.
The most important thing to note here is that the type of life insurance policy that you should look into ultimately depends on your stage of life and personal needs.
What types of life insurance are available?
There are different types of life insurance – and one does not necessarily present more benefits than the other.
Your focus in picking your policy should be geared toward finding what works best for (a) your finances and (b) the goals you hope to achieve with the funds.
There are two standard types of life insurance that you need to be aware of: Term and Life.
Term life insurance provides protection for a defined time period (or term) that typically falls between 10 and 30 years.
This type of insurance tends to be less expensive than Life policies due to its associated expiration date. We recommend this type of insurance for those who need more extensive coverage for a particular period.
Whole life insurance, on the other hand, covers you for life. When premium payments and terms of conditions are met, each payment made becomes a part of your policy’s total value.
The best part is: if you have an event that occurs in which you need to draw from the account, it’s as good as cash. In addition, you’re able to borrow against the policy’s value to supplement your needs.
People are drawn to this type of coverage because of its fixed premium rate, meaning the amount you pay will always stay the same.
If you are looking to purchase life insurance later in life. In that case, this type of policy features a Guaranteed Issue Whole Life Insurance type designed for those ages 50-85 who want to apply for life insurance without answering health questions or taking a medical exam.
So, what’s this going to cost me?
The cost of life insurance varies based on your lifestyle. The price you’ll encounter depends on several interworking factors like policy type and the amount of coverage needed.
When purchasing life insurance, you need to be aware that things such as health status, age, driving record, and lifestyle will come to play in the overall plan price. The lower risk your situation is, the lower price you’ll pay.
We hope that this helps clear up some of the questions that have crossed your mind about life insurance. If you’re looking to take the next step in securing funds for your loved ones later in life, talk with one of our advisors to learn how to get signed up.