- Stephanie Banks
11 Reasons Everyone Needs Life Insurance
Updated: Nov 12, 2021
Stephanie Banks - October 12, 2021
When you’re young, life insurance might not be on your “to do list”. But the longer you wait, the bigger your chance of something happening before you get coverage. Also, the younger you are, the lower your rates will be. With this in mind, here are 11 reasons to stop procrastinating and get coverage now.
1. Replace Lost Income
What would happen if you were to suddenly pass away? Would your loved ones be able to stay afloat financially? Especially if you are the only income source in the family? It is extremely important to get yourself adequate coverage and not leave your family wondering how they will pay the monthly bills.
2. Cover Burial Expenses
Pre-paying for your funeral doesn’t work in every situation. Burial expenses, AKA final expense policies give you that guarantee that your final arrangements will be paid for and lift the burden from your grieving loved ones.
3. Pay off Debt
Our debts don’t always go way when we die. If someone co-signed on a loan with you, they are now solely responsible for repayment. That or creditors will try to collect from your estate. This depletes what your heirs receive. Life insurance assures these debt can be paid off without affecting your estate.
4. College Planning
While there are many ways to save money for your child’s education, life insurance is one most people don’t think about. Borrowing against your life insurance policy could help either prevent the need for student loans, reduce the amount of student loans needed, or help wipe out the student loans afterward.
5. Build Cash Value
Whole life policies provide permanent coverage. These allow you to build up cash value over time. Cash value is an extra cushion you can use at any time. Great for unforeseen financial emergencies.
6. Diversify Investments
Universal life insurance policies receive dividends based on a performance rate. These are sometimes risky, so you’ll want to speak with an agent before deciding if they’re a good choice for you.
7. Business Planning
If you own a business, it’s very important that you have life insurance. If you’re part of a partnership, each partner needs insurance so that no one is left holding the bag if something happens to one of you.
8. Estate Taxes
A life insurance policy can help cover the inheritance taxes your heirs will have to pay on any assets they receive.
9. Coverage is Affordable
Many people have the misconception that insurance is expensive. When actually, coverage is usually very affordable. Some products are less expensive than others. The younger you are, the lower your premiums. If you’re a non-smoker and don’t have pre-existing conditions, premiums are very affordable. If you are a smoker or have pre-existing conditions, it’s still possible to get some coverage in smaller amounts.
Even if you have no other assets to leave to your heirs, you can create an inheritance by buying a life insurance policy.
11. Peace of Mind
Knowing your loved ones are taken care of, no matter what happens, will give you peace of mind.
A few other important things to keep in mind:
· The best time to buy is early on, even as young as your 20s
· If you financially support a partner, children, or aging parents, you NEED life insurance
· Life insurance is for the living.
· It buys time and options.