My husband and I purchased a term life insurance policy 18 years ago, shortly after the birth of our first child. I’m not sure we would have thought to buy if my father had not been an insurance salesman; nonetheless, we felt like responsible parents. All I knew is that it was fairly inexpensive and that I hoped we would never use it. Thinking about your own death or losing a loved one is not on anyone’s wish list, but you know what they say about death and taxes–it’s inevitable.
Securing a life insurance policy when you’re relatively young and healthy is ideal if you are responsible for other people and have the resources. If you are on your own, there’s really no point. When it comes to how much coverage you should carry, experts recommend a sum that is 10-15x your income. That’s likely a high number, but you can imagine how quickly that number will shrink when bills are due and life goes on. Ask yourself three questions:
- Who depends on me?
- How much can I afford?
- How healthy am I?
Many companies offer life insurance to their employees, and that’s great, but it is usually insufficient for anyone who has other people depending on them for daily living expenses for an indeterminate period of time, such as a spouse, sibling or elderly parent. What about the mortgage, car payments, private school or college tuition, or possibly a wedding in the near or distant future? Basically, the more responsibilities you have, the more coverage you need.
Talk to your agent about the different options of term, whole, and universal life policies to determine which would best meet your needs now and fulfill the needs of your dependents later.
Your financial and family situation will determine whether you need life insurance.
The younger you are the lower your premiums, but older people can still get life insurance.
Carry as much as you need to pay off your debts plus any interest.
Your policy’s payout should be large enough to replace your income plus a little to hedge against inflation.
from Investopedia
While we’re on the subject, I thought it would be fun (in a macabre sort of way) to share the lifetime odds of death for selected causes. The world is battling a pandemic at the moment thanks to COVID-19, so mortality and the fragility of life is on the forefront of every news report and social media post. Here are some statistics for other ways to die from the U.S. National Safety Council, based on data from the National Center for Health Statistics, 2017.
Airplane crash: 1 in 188,364
Dog attack: 1 in 115,111
Lightning strike: 1 in 218,106
Accidental firearms discharge:
1 in 8,527
Cycling: 1 in 4,047
Car crash: 1 in 103
Y’all be safe out there and take precautions to look after your family, so you (and they) have one less problem to solve.
Crossing T's and Dotting i's 