Take a look at the people you love and ask yourself if you’ve done enough to protect them from the “what ifs.” What if something happened to you? Will your life insurance policy provide enough coverage for the family you leave behind?
When is the last time you reviewed your policy? Now is a great time for a life insurance review. We can walk you through the options available to you to make sure you’re fully covered without overpaying for something you don’t really want or need.
Life insurance planning needs to be done with a goal-based approach. For example if you are only looking to cover a portion of time, maybe while you have dependent children, you shouldn’t over pay for lifetime coverage.
Know your goal for any coverage that you are buying and then find the product that best fulfills that goal. There are several types of life insurance including:
- Term insurance, which is cheap and meets short-term goals.
- Return of premium term, which is a little more expensive but gives you the option to take a paid-up death benefit or get a full refund of your premiums paid at the end of your level term.
- Universal Life in all of its variations can make sense for someone wanting coverage, flexibility, and the ability to grow tax friendly money within the policy.
- Whole Life insurance can be a good fit for the person who wants both permanent coverage and tax friendly growth ability.
- If you are worried about being a burden to your family because of Long Term Care needs and expenses there are even LTC riders (options) you can add to many types of life insurance.
- Group life insurance is a valuable asset and I believe, if you have it available, you should utilize it to a degree. I like group life because it is usually cheaper than individually owned policies. However, you are beholden to the employer for access to this benefit. If you no longer work for that employer or they cancel the benefit, you might not be able to get individual life insurance if your health has changed. For this reason I like using group life for no more than 50% of your overall amount. That way you are always in control of at least half of you benefits.
Because there are so many different ways to buy life insurance, we strongly suggest that you work with an independent agent or professional that can offer you unlimited access to a variety companies and products. Your needs and goals are your own and you deserve a product that meets them.
I often get asked, “How much life insurance should I have?” There is no blanket answer. Life insurance is a purchase made out of love and as a key component of estate planning. I would say the bare minimum would be enough to cover the major debts and provide for at least 50% of the deceased income at a reasonable rate of return (5%). For most of the people, including myself, this works out to about 10 times your annual income.
It’s important to remember why you’re buying life insurance, out of love for your family, and to understand how the products you’re purchasing will affect them.
If you have any questions, or would like an independent analysis of your coverage, call today to set up an appointment. Use your heart for motivation, your head for action, and start today.