Before you go buying life insurance, it’s important to know why you need it. Life insurance serves to provide for your beneficiaries in a number of ways and is essential to carefully securing your assets in the future. Here are four of the top reasons to consider life insurance:
- Final Expenses – Final expenses refer to any expenses related to someone’s passing. This may include a casket, funeral, preparations, memorial service, cremation, etc. While the median price of a funeral with a casket averaged over $7,000 in 2016, families without the means to finance such preparations may be forced to ask for donations or cut back on plans. For most, a fairly modest life policy will suffice in cutting the burden of financing a funeral during unfortunate circumstances.
- Child Expenses – Planning for your children’s future can take a fair amount of consideration when ensuring that they are well taken care of in years to come. Taking into account the daily expenses with childcare such as daycare, living upkeep, and schooling are only partial to the larger picture. Be sure to consider future expenses such as college tuition too.
- Income Replacement – Chances are your family depends on your source of income in order to meet daily needs of life. In addition to current costs like utilities, loans, food, medical expense, future costs like a child’s education can garner a large sum and must be considered when building a policy. If you were to pass without setting up an adequate financial replacement plan, your family’s standard of living could diminish.How much life insurance you need is based largely on two factors: your salary and the number of years until you retire. An insurance agent will also account for any other factors such as Social Security benefits, your partner’s income, and your assets. Always aim to buy the amount you really need—but also remember that anything is better than nothing when it comes to life insurance coverage.
- Eliminating a Mortgage – A person’s mortgage often stands as their single largest debt. Without a secondary income, your family could stand to lose the home you spent years building lasting memories in. Furthermore, your loved ones could be forced to move in order to maintain stability and the impact of such a shift could lead to much more than just financial stresses.Life insurance offers an opportunity to pay off a mortgage in full; eliminating the need for your surviving family to finance any outstanding payments.
If you’re considering a life insurance policy, feel free to talk to your hometown professionals at Allegheny Insurance. We’re here to assist you along the way and answer any questions you may have. Feel free to reach out to us at 304.636.1680 or request a policy review.