Most of us would prefer not to think about what would happen to our families if something happened to us. Life insurance is something we may have to force ourselves to think about, just like a will. The good news is that purchasing a whole life insurance policy can be a great financial investment. This form of insurance not only allows your life to be insured, but is also a savings tool – you can even borrow from your policy if you need to. There is no “one size fits all” policy – the calculation about how much coverage you need must be done on an individual basis.
Some people are not ready to buy whole life insurance and want coverage that costs less. Fortunately, many term life policies can be converted to a whole life policy in the future (make sure to check with your agent for the specifics). In the meantime, your loved ones are protected and you can breathe easy knowing they will have access to funds when and if it is necessary. A big advantage with life insurance is that these funds are not taxable. The whole amount will be paid to the beneficiaries you name.
How much life insurance is enough?
The way to determine how much life insurance is sufficient is to calculate the various costs that your spouse or other loved one would be facing if you were gone starting with your annual income. Figure in the cost of educating your children, which as we know, can be expensive. There are also costs associated with a death such as burial and funeral expenses than can be a burden to your loved ones, but that can be easily alleviated by investing in a sound life insurance policy.
Essentially, you want to provide enough income so that if you’re gone, your family doesn’t suffer from serious financial problems. The number of working years ahead of you should be part of your calculations, as well as the amount that would have been contributed to a retirement account over that time.
An important fact about life insurance is that it is not currently taxed, and your loved ones will have access to the funds quickly. An estate, particularly an estate with many assets, can take years to navigate through probate. Even a simple estate can mean a long wait, so life insurance funds are a huge advantage during this period. The entire insurance amount will be issued to the beneficiary you name, and this can give you a great feeling of confidence about the future.
Planning ahead and buying life insurance may be a little tough, but when you work with a local agent, it’s far less stressful. At The Harrin Group in San Antonio, Texas, you can get answers to all of your questions. We make it as simple and stress-free as possible. Our entire team lives and works here in San Antonio and we have very flexible schedules. We can set an appointment that is convenient for you, after work hours, or on weekends if that is better. Both you and your spouse should participate in the conversation. It is best for both spouses to carry life insurance. We have noticed that our clients experience great relief once they have their life insurance policies in place.
No matter your level of income, there is some type of life insurance policy that you can afford. We will show you how it works so you can make an informed decision. We are here to help ensure that your family is protected.