Why buy life insurance?
Has there ever been a better time to consider life insurance?
We never know when something tragic might happen to us, but if it did, wouldn't you feel better knowing your loved ones won't face an additional financial burden at the worst possible time?
There's no doubt you've seen and probably even contributed to gofundme™ campaigns or fundraising car washes for people who had unexpectedly lost a loved one. While we are fortunate to live in a society where we can lean on the generosity of complete strangers, is raising a significant amount of money in a short amount of time through internet fundraisers something you can confidently depend on?
Life insurance is an afforadable way for someone who has not yet accumulated savings to pass on significant amounts of money to those they leave behind. If you don't have savings yet, ask yourself how would my loved ones continue to pay the rent each month if I was gone? Would they be able to afford groceries, utility bills, college tuition, insurance on their cars? Would they be able to afford your funeral expenses? Life insurance gives you an afforadable way to fund all of those needs yourself without leaving your loved ones behind to beg for financial help from friends and family.
I encourage you to take just a few minutes today to find out what it costs to make sure your family is taken care of financially should something happen to you. I think you will be surprised to find how affordable life insurance can really be.
Is your family prepared if something happens to you today or will they be depending on the help of others?
Dramatization. Family and fundraiser shown are fictional. Photo Credit Catharine Scott
How Does Life Insurance Work?
How Much Coverage Do I Need?
Most people starting out don't have a lot of savings. Life insurance gives people like you an affordable way to make sure the loved ones who depend on your care and income are provided for financially if you should suddenly pass away. For a fairly low monthly payment, you can provide hundreds of thousands of tax free dollars to those you leave behind. As you build up savings over time, your need for life insurance will be reduced and eventually eliminated.
Life insurance works like most other insurances. You make a monthly insurance payment and if an insured person passes away, the insurance company pays a specified amount to the designated survivors. The amount you pay monthly is based on your age and health at the time you apply plus the amount of benefit you want your loved ones to receive. A healthy 35 year old male can buy $500,000 worth of coverage starting at around $25 per month.
A general rule for buying life insurance coverage is to look for 8-10 times your annual income in coverage. For example, if you earned $50,000 per year, you'd want around $400,000 to $500,000 in coverage. This amount allows the recipients to use the money to generate an income stream similar to your annual salary. If you already have some savings accumulated, you can reduce the amount of coverage. However, if you have significant amounts of debt, you might want to increase the coverage to cover those debts. Another tip is that it is easier to purchase a greater coverage amount while you're healthy enough to qualify and reduce your coverage later than it will be to increase your coverage at a later date if you wind up wishing you had more.
How Long Should Coverage Last?
Term insurance allows you to lock in a rate for a set term(10, 15, 20, 30 years etc.) and after that term, the payment will go up substantially. You should choose a term that reflects the longest period you think your loved ones might depend on the coverage. If your youngest child is 10 years old and you expect her to be self reliant by the age of 30, a 20 year term is probably sufficient. If you have a dependent spouse, consider how many years it may take for you to accumulate enough savings for him or her to live comfortably and use that timeline to choose an appropriate term. Keep in mind, that the longer term you lock your rates in for, the pricier your monthly payments will be.
Christopher D. Munchhof
Life Ins. Lic.#0G66721
22924 Lyons Ave Suite 205
Santa Clarita, CA 91321
Click the link below to get started. If you like the rates you find, feel free to complete an online application or call to set an appointment and I will contact you with more information. Don't hesitate to contact me directly with any questions!
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in the quote form is, the more accurate your quotes will be.