Are you one of the people who think you don’t need life insurance? Please think again. Life insurance provides real security for those you care about. Life insurance benefits can provide financial security and resources for your family or loved ones after you are gone. Let’s look at a few of the reasons to consider life insurance:
• Payment on Debt– If you have any outstanding debt (mortgage, credit cards, etc.) at the time of your death, it does not go away. Your estate will still be responsible to settle all accounts. Life insurance can provide the financial resources to cover debt.
• Continuation of Income- Life insurance can provide the funds to replace your income upon your passing. Family income will certainly diminish with the loss of an income earner, which means your family will experience a lower standard of living. The death benefits of a life insurance policy can prevent this from happening, or at least keep the impact to a minimum, by replacing income lost with the demise of the breadwinner.
• Unpaid Medical Expenses- It is highly likely that you will incur medical expenses prior to your death. Some of which may not be covered by health insurance. Adequate life insurance proceeds ensure that these final expenses are covered.
• Funeral Expenses- Most people don’t plan for, or fund, funeral expenses. Again life insurance is there to help.
The good news is that life insurance rates are low and there are many different kinds of products to select from. One question we often get is, “How much life insurance do I need”? The answer to that depends on your individual situation, but the general guideline is, a life insurance limit of at least ten times your annual gross income is a start. For example, if you earn $50,000 per year, your family would need to replace somewhere close to that amount. A $500,000 life policy could return $45,000 to $50,000 annually, depending on interest rates.
The most cost effective type of policy is term insurance. Term insurance provides protection for a specific, limited amount of time, usually in five-year segments, such as for 10, 15, 20, 25 or 30 years. Typically you pay annually and the premium is locked in for that period of time.
Robert M. Galligan & Associates, Inc. has some excellent affordable plans available, so please email or call us at 530-742-3243 so we can help you plan for the future.