September is life insurance awareness month! While planning for your departure from your loved ones can be hard to imagine or think about, it’s essential that we leave our families with more than just memories. Life insurance is vital to setting our family up for their future during one of the most difficult losses of their lives. How do you decide what life insurance is right for you? How do you get life insurance? Let’s discuss a few options.
The main difference between term life and whole life insurance is the length of coverage and the flexibility of the policy. Term life insurance covers the policyholder for a set period of time, such as 20 or 30 years. Your loved one(s) will receive a death benefit if you pass away during the set period of time of the policy. It’s usually more affordable than permanent life insurance. When the policy ends, coverage stops and there’s no cash value to receive. Whole life insurance is a permanent life insurance policy that covers the policyholder for their entire life. It has fixed premium payments and a guaranteed death benefit. Whole life policies may have cash value that can be accessed if the policy is surrendered.
We know the differences between whole and term life. Now what? Every person’s situation is unique, and the decision to buy a whole vs. a term policy should be guided by your specific situation what matters to you. Things to think about:
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How old are you?
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How is your health?
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What are your family’s financial needs? This includes any debt/mortgage etc.
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What are the ages of your children? Do you want to provide enough for them for college/helping buy their first home?
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Are you concerned about long-term health expenses and serious illness?
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What are your plans for retirement?
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How will you pay for funeral expenses?
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Are you concerned about estate planning and tax ramifications?
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Do you have existing life insurance, perhaps through your employer?
There can be a significant cost difference between a term policy and a whole life policy at first, but whole life premiums stay the same over time, and term coverage becomes increasingly more expensive at every renewal.
The world of life insurance is incredibly vast and there are even more options than what we’ve briefly touched on. Please feel free to reach out to us (574.258.5555 or read more on our life insurance website page) so we can help you find the best option for you!
