No one likes to think about their own mortality, but unfortunately, death is a fact. Though there’s nothing we can do about it, life insurance is one way we can soften the blow for our loved ones after we go. More than half of all Americans have some sort of life insurance, and it only gets more popular during uncertain times such as these.
Learn more about choosing the right life insurance policy today.
Life insurance is a financial product that you can apply for through your bank or insurance broker. In its simplest form, the policyholder (you) pays a monthly premium in order to secure a death benefit. The death benefit is the total amount of money paid to the beneficiary or beneficiaries—the person or persons who receive the money after the policyholder dies.
There are several different types of life insurance, which we’ll cover below, and they can all be customized to your needs. For instance, the amount of the death benefit depends on how much you anticipate your beneficiaries will need, as well as how much of a premium you can afford to pay. The earlier you invest in life insurance, the cheaper it is, since many plans require a medical assessment. There are plans that don’t require a health check, but those tend to be more expensive.
There are a few reasons you might want to get life insurance, but the main one is to protect your loved ones if anything happens to you.
For example, if you have a mortgage on your house, your spouse may be left carrying the debt on their own. A life insurance payout can either help with the payments or pay off the house entirely, lightening their load considerably.
Another example is if you have children and you want to make sure they will have enough for their care and education down the road. Life insurance money can also cover other milestones like their first down payment, marriage, or purchasing a car.
Alternatively, you may have elderly parents and want to make sure there will be enough to fund their care. In rarer cases, you may have a disabled relative that you want to look out for in case anything happens to you. Situations like this are what life insurance is made for
Before you can choose the right life insurance, it’s important to know the differences between the three basic types, term, whole, and creditor. They each offer unique features and benefits.
As you can see, these three types of basic coverage serve very different purposes. However, all of them can have a significant impact on making life easier for your loved ones after you pass.
If you’re considering life insurance, there are plenty of options out there. It’s important to do your research to make sure you’re getting the one that meets your needs at a premium you can afford. Going with your regular financial institution doesn’t always guarantee the best deal, so start your search by looking online for life insurance policies that are right for you.
It’s true what they say: money makes the world go round. In order to succeed in this life, you need to have a good grasp of key financial concepts. That’s where Moneymade comes in. Our mission is to provide you with the best financial advice and information to help you navigate this ever-changing world. Sometimes, generating wealth just requires common sense. Don’t max out your credit card if you can’t afford the interest payments. Don’t overspend on Christmas shopping. When ordering gifts on Amazon, make sure you factor in taxes and shipping costs. If you need a new car, consider a model that’s easy to repair instead of an expensive BMW or Mercedes. Sometimes you dream vacation to Hawaii or the Bahamas just isn’t in the budget, but there may be more affordable all-inclusive hotels if you know where to look.
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