Many Americans consider whether or not to get life insurance. Is it really worthed or is it just one expense more? Getting a life insurance policy is not mandatory but highly encouraged, especially when you have a mortgaged house, there are children at college or if you want to protect your family in case you are not there for them.
If you don’t want your family to lose the house, your kids to switch school districts, and your spouse to work multiple jobs, it is advisable to hire a financial advisor to help you do the right thing sooner and make sure your income is securely covered. In this way, when you pass away, you have made sure that your family is financially well off.
Why purchase life insurance?
Although it is a voluntary policy, having life insurance is recommended for those users who want to be protected against any disease and, in the worst case, against death. The main reason is that it is a product that allows the family to be financially supported in this type of situation.
About sixty percent of all people in the United States were covered by some type of life insurance in 2018, according to LIMRA’s 2018 Insurance Barometer Study.
When Should You Get Life Insurance?
If you’re wondering “why to have life insurance,” here are some examples of when it’s a good idea to enroll.
1. There Are People Who Depend on You
If you’re a parent with young children, don’t hesitate to get life insurance. If anything were to happen to you, you’d be able to rest assured knowing that your spouse and kids are taken care of.
If you’re a single parent, you should also get life insurance so that your kids will be taken care of should something happen. That money could be used for childcare and other expenses if a family member takes over caring for your children.
Even if you’re divorced, the costs could help cover child support and other expenses, should the worst happen and you pass away.
2. You Have a Mortgage
A life insurance policy can help to cover mortgage payments so that your family doesn’t have to move, should something happen to you.
You can set up your term life insurance to match the years of a mortgage.
3. You Want to Provide an Inheritance
If you don’t have a lot of wealth or much to leave behind, taking out a life insurance policy is an excellent way to ensure that you leave something behind for those you love and care about.
Not leaving the family unprotected in the event of death is the main reason that leads a person to get a Life Insurance policy.
4. You’re a Business Owner
Opting to sign up and pay for life insurance can help pay off your business debts and help your heirs pay off estate taxes.
It could also be used to fund a buy/sell agreement.
And even though you should set aside tax payments every quarter, if your business owes taxes, your policy could cover that too.
5. You Want to Make Sure Your Funeral Is Paid For
The average funeral costs $7,000 – $12,000, but they can cost a lot more. Life insurance can make sure that your funeral costs are covered.
6. You Have Co-Signed Debt
If you have a debt that someone co-signed, their credit is dependent on how consistent you are with payments.
Plus, they’re responsible for the remainder of the debt, should you pass away. Enrolling in a life insurance policy is a smart way to make sure your co-signer isn’t held responsible for what you owe.