Reasons to Buy Life Insurance...
Why do I need Life Insurance?
Life insurance is an essential part of financial planning. One reason most people buy life insurance is to replace
income that would be lost with the death of a wage earner. The cash provided by life insurance also can help ensure
that your dependents are not burdened with significant debt when you die. Life insurance proceeds could mean your
dependents will not have to sell assets to pay outstanding bills or taxes. An important feature of life insurance is that
no income tax is payable on proceeds paid to beneficiaries.
How much Insurance do I need?
Before buying life insurance, you should assemble personal financial information and review your family's needs.
There are a number of factors to consider when determining how much protection you should have. These include:
any immediate needs at the time of death, such as final illness expenses, burial costs and estate taxes;
funds for a readjustment period, to finance a move or to provide time for family members to find a job
ongoing financial needs, such as monthly bills and expenses, day-care costs, college tuition or retirement.
Although there is no substitute for a careful evaluation of the amount of coverage needed to meet your needs,
one rule of thumb used is buy life insurance that is equal ten to twenty times your annual gross income.
Why is it critical to buy life insurance now?
There are several reasons for purchasing life insurance now:
1. You cannot predict the future or the timing of your death.
2. The cost of life insurance is based on your age: the older you get, the higher the premium.
3. Buying now can help you avoid future insurability problems. Insurability is based on a variety of factors, including
health and age, and rates are affected by certain health conditions, which may not be present now but may
develop in the days ahead.