Life insurance is always a sound investment, especially when considering the well-being of your family. But even if it is a wise investment to make, it is usually very difficult to think about. No one likes to think about leaving their family behind, but it is something you need to plan for.
In this article, we’ll discuss the benefits of life insurance and how often you should look over and update your policy.
The Benefits of Life Insurance
Life insurance policies can help you since the policy term usually expires by a certain time. Therefore, your life insurance policy may be ready for you to claim by the end of its term, which can make it a type of supplemental income for your retirement. Furthermore, the policy can even allow people to take out loans or small sums of cash while still paying the premiums, making it a great backup reserve.
Money for Your Children’s Education
It’s no secret that college can be very expensive, which is why you want to leave something behind for your children to use at a later date. Allowing them to pay for their tuition without having to take up an extra job or take out loans can give them the ability to grow their bank accounts instead of accumulating debt. You can also access the funds in the policy when you’re still alive, making it a great reserve for college funds.
Checking Your Life Insurance Policy
You should understand that a life insurance policy can change over time, especially when major changes happen in your life. You might be buying a new home or have a baby on the way. Both of these things can greatly impact your insurance policy, which is why you should always make changes along the way. Here are some of the various factors that could affect your life insurance policy.
Moving to a New Home
Buying a bigger home typically means a larger mortgage. If needed, the funds from your life insurance policy can be used to pay off your mortgage.
To do this, you can extend your policy to last the duration of your loan.
Oftentimes, employers will have life insurance policies available for their employees to select from. The amount is usually much greater than the employee’s annual salary but only stays in effect as long as you work with the employer. Therefore, if you leave the company you’ll have to take out a personal life insurance policy.
We suggest taking out a personal policy that will be in effect no matter who you work for. That way you don’t have to worry about losing coverage once you no longer work for a certain employer.
Depending on the changes in your life, your current life insurance policy might need some updating. Therefore, we suggest consulting with your insurance agent on how your policy may need to be adjusted so you’ll have optimal coverage.