How you plan today will determine how you, and your family, will live tomorrow.
When it comes to life insurance your needs may differ depending on where you stand in your personal and professional life at a given point in time. There are various milestones that may affect your life insurance needs. Understanding life insurance needs at each milestone can help you protect your kids, partner…you know, those who love you. So, where is your life today?
If you’re single with no kids or partner you should still consider some life insurance coverage. Ask yourself…did anyone cosign for my student loans? How much will it cost my parents to bury me if I hit the dirt? How much will it cost my family (from their own savings) to sundown my entire financial life?
Remember, death and taxes. In death, your earnings will be taxed.
Marriage & Divorce
When entering a new marriage, your financial lives are typically joined as well. With the infusion of a second income comes more expenditures – a new financial lifestyle. Part of that new life should include an updated financial plan that includes life insurance.
Think about it, can your current lifestyle be maintained with just one income? What happens if one of you dies? Car payment, rent or mortgage, food, debt…it all adds up. Can your partner afford to mourn?
In the unfortunate event you divorce, it’s a good idea to immediately review your policy. You’ll want to update your beneficiary, reexamine the coverage amount and update your contact information.
Once kids are involved life insurance becomes even more important. Your children cannot provide for themselves and with the cost to raise one child from birth to age 18 totaling more than $200,000, it’s something you shouldn’t put off. Unless you plan on dipping into grandma and grandpa’s retirement pockets to raise your kids if you die.
Remember their education. College costs have skyrocketed and you’ll want to make sure your life insurance plan can cover the cost of housing, tuition, books, etc.
When considering your life insurance options, you should also learn more about policies for your kid(s). If the unthinkable should happen, how much time will you need to mourn? Would your vacation days cover the amount of time you’ll need?
You buy a home on your own or with someone, maybe a partner. If you die and leave behind a partner, how will he or she cover the mortgage? Let alone other expenses like maintenance, utilities, unexpected repairs, and property taxes. Even if you’re single, someone will need to cough up the funds to manage the sale of your home. It’s not free.
Life insurance can be used to pay the entire mortgage, and support those you’ve left behind.
Finally got that promotion you’ve been hoping for? Or maybe a new job with a very respectable bump in pay. Now that you are earning more, you’ll likely spend more. Life insurance coverage can help your family maintain their new standard of living when you’re no longer there to provide.
Maybe you’re an entrepreneur. You’ve built a successful business and now you need to protect it. As a business owner, you want to ensure your employees and the business can continue growing after you’re gone. Life insurance can protect your business and the owners that are left behind.
The video below talks about some of the reasons life insurance is critical for small business owners.
Also, if you’ve already got your business covered remember to reevaluate your policy every time your business goes through a phase of change (becoming more profitable, acquiring more debt, hiring employees at key positions, etc.).
Consider this, one day you’ll need to care for your aging parents. Will they be able to afford to take care of themselves if you died prematurely? Did their retirement plans include your help? Healthcare, housing or long term care – all things to consider when learning about how life insurance can help protect your family.
Life insurance should also play a significant role in your retirement plan. The right policy can provide for your loved ones who may not be able to live comfortably on your retirement savings alone.
Keep Reading and Learn How to Save Money for Life