The Lowdown on Life Insurance
Make sure your family can grieve loss without struggling financially.
Many people cannot imagine not insuring their home or car, but when it comes to their lives people tend to place life insurance lower on the priority list. Considering the circumstances of when life insurance would come into play isn’t exactly enjoyable. But in the event of an unexpected death, too little insurance can place your loved ones in a tough financial situation.
According to U.S. News & World Report, three in ten American households have no life insurance. Additionally, many Americans knowingly hold much less life insurance than they know they will need. The most underinsured group is the millennials in their 20s and 30s. Although, this is the ideal age range to plan ahead and purchase life insurance since it’s much cheaper.
So what is a basic definition of life insurance? It is a contract between you and an insurance company. In exchange for your monthly payments called premiums, which are determined by age, medical conditions and other factors, the company agrees to provide a death benefit to the named beneficiaries in the event of your death. Life insurance is a necessary and beneficial safety net for loved ones in the event something happens to you.
If your first thought is that you’re already covered by an employer life insurance policy, take a closer look at the amount. It’s likely not nearly enough coverage. Ideally, your entire financial situation should be evaluated to make the most appropriate life insurance choice for you and your loved ones.
Here are some things to consider when determining your life insurance needs.
Types of life insurance policies include:
Certain life changes should also encourage you to add life insurance to your financial plan. Having children, protecting a new mortgage or protecting a growing business are some good reasons to consider your insurance needs. It’s important to keep in mind that the clock really is ticking. As age increases, so does the cost of a life insurance policy. Certain health conditions may affect insurance coverage qualifications too.
If you have any questions about life insurance and how it fits into your overall financial plan, request a call from a Bayntree financial advisor today.
Bayntree Wealth Advisors, located in Phoenix and Scottsdale, Arizona, provides comprehensive financial planning and wealth management. The Bayntree team specializes in all aspects of financial health, including retirement planning, risk management, investment advice, tax strategies, estate planning and insurance.
Bayntree does not provide specific legal or tax advice. Please consult with your tax advisor or legal professional for guidance with your individual situation.