Insuring Your Policy Reflects Current Living
As your standard of living rises or your family grows, the life insurance benefit your loved ones would need in the event of your death may also change. If it has been a while since you last reviewed your family's life insurance needs, now may be a good time to do so.
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Two Common Factors Affect Insuring
According to a 2002 study, families making $65,800 or more a year will spend nearly $250,000 to raise a child from birth to age 17. Would your current life insurance policy provide enough income to see your children to adulthood? Would there be enough money left over to send them to college?
If you purchased a new home in recent years, a higher mortgage payment may also warrant an increase in life insurance coverage. Even if your spouse has a well-paying job, your mortgage payment may be too much for one person to handle alone, especially if child-care expenses also increase.
Many people try to estimate the amount of life insurance they need by multiplying their annual income by an arbitrary number. However, a more thorough calculation that takes into account your family's specific long-term needs can help you identify the amount of life insurance required to maintain their comfortable lifestyle indefinitely.
By reviewing your family's needs on a regular basis, you can help ensure that your life insurance policy keeps pace with your life and your dependents' needs.
Buy Life Insurance Policies Prudently
We had heard about annuities and were investigating them for our IRAs. We also heard bad things about pushy brokers over the years. So when we went to the ImmediateAnnuities.com site we were skeptical about calling them. But whenever we called their staff was really friendly. They answered all our questions and one of their reps even told us that at our ages there was no advantage to buying the annuity with our IRAs. These guys are really honest!
The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased. Before implementing a strategy involving life insurance, it would be prudent to make sure that you are insurable by having the policy approved. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mortality and expense charges. In addition, if a policy is surrendered prematurely, there may be surrender charges and income tax implications.