If you have dependents, you probably need life insurance. This type of coverage pays for more than just your final expenses; it can provide a final gift to your family in the form of long-term financial security.
When to Purchase Life Insurance
In most cases, life insurance is best purchased as soon as possible. This is especially true if you have dependents that look to you for financial support. The younger and healthier you are, the easier it is to qualify for coverage, and the lower your premiums are likely to be.
Don’t Depend on Employer Coverage
Too often, workers make the mistake of relying on employer life insurance coverage instead of purchasing a private policy. Not only is employer coverage often too little to meet your needs, but it also may not be transferable to you if you leave your job or get laid off. By that time, changes in your age and health may result in much higher premiums or otherwise disqualify you completely from private coverage.
Types of Life Insurance Coverage
There are several types of life insurance, although most can be defined as either term or permanent coverage. You may find that one type will support your needs and goals or perhaps that you want both permanent and term life insurance policies to provide a long-lasting financial solution.
Term Life Insurance
Term life insurance is coverage designated for beneficiaries should the insured individual pass away during a specific period of time. You can pick your term – usually between 10 and 30 years depending on your needs. At the end of that term, the policy expires, effectively revoking the death benefit.
Despite the limitations that come with term life insurance, it is the preferred choice of many families – often as a supplement to a permanent life insurance policy. Because term coverage eventually expires, the premiums are usually very low for high benefit amounts. This makes it easy for families to afford hundreds of thousands or even millions of dollars in death benefits to sustain dependents in the event of an unexpected death.
Term life insurance is often used for things like final expenses, income replacement, debt payoff, and more. The coverage makes it possible for families to maintain their financial standards of living despite the passing of a primary earner or someone who contributes to the household in other valuable ways, such as childcare, lawn care, and housekeeping.
When choosing a term limit, consider how long you have until you are either financially independent or you no longer have dependents to support. For many people, this could mean purchasing a term that will last until retirement or until a youngest child finishes college.
Term life insurance may be right for you if:
- You need high benefits at an affordable price
- You are seeking long-term income replacement
- You wish to pay off your family’s debts at your passing
- You anticipating gaining additional dependents in the near future
- You wish to leave a financial legacy in the event of your passing
- You need to protect your family’s financial interest in a business
Whole Life Insurance
Whole life insurance policies are permanent, meaning they will never expire. They are also fixed-premium, meaning the cost of your coverage will never change regardless of age or changes in your health. You will pay the same in year one as you do in your final year of coverage, making it an affordable long-term life insurance solution.
In addition to a death benefit, whole life insurance usually has a cash value accumulation feature. That means that as premiums are paid into the policy over many years, the policy can accumulate additional cash value that can be borrowed against if necessary. Because of these extra benefits, the premiums for whole life insurance policies tend to be more elevated than those of term life insurance policies.
You may be a good candidate for whole life insurance if you want:
- Guaranteed life-long protection that you cannot outlive
- Living benefits you can use while you are still alive
- Level premiums for life
Universal Life Insurance
Like whole life coverage, universal life insurance policies are also permanent and have the ability to accumulate cash value over time. However, these policies also offer flexibility that is not typically available with whole life coverage. As cash value grows, you can allow it to continue growing tax-free, use it to skip a premium, or eventually use it to pay less for your death benefit premium in seasons when you might need cash for other expenses instead.
Universal life insurance may be right for you if you want:
- The flexibility to adjust your premiums over time
- Guaranteed life-long protection that you cannot outlive
- Living benefits you can use while you are still alive
Affordable Life Insurance in Mequon, Wisconsin
If you are in the market for a new life insurance policy or are looking to replace a policy that no longer meets your needs, we here at Mark Leonard Insurance can help you find an affordable solution based on your goals and preferences. We can shop and compare rates from multiple life insurance carriers to find the most competitive rates on the coverage you need. Whether you are looking for a short-term financial security blanket or a long-term financial asset, we are happy to help you choose a policy and coverage amount that works for you.
Contact us today to request your free quotes. We look forward to serving you soon.
