Tuesday, April 30, 2013

How Much Life Insurance Do You Need?

life insurance, coverage, insurance, death, expenses
Life insurance can help your loved ones meet their expenses and maintain their standard of living in the event of your untimely death.  The following are a few things to consider as you determine the amount and type of coverage to purchase.
  • How much money will your family need to cover the lack of your income?  Are you close to retirement, or are you providing for a young family?  The coverage you will need is tied to the amount of income you would need to replace in the event of a premature death.  
  • What debts do you have that your family will need to pay? These may include a mortgage, automobile loans, student loans, credit cards, and so on. Remember to take into account funeral expenses as well.
  • What specific expenses would you like to cover for your family in the future (general living expenses, college, weddings, etc.)?
  • Will your family need to replace your annual income, or will your spouse’s income be sufficient for their needs?
  • At the very least, purchase enough coverage to pay your debts and funeral expenses.
  • Make sure the policy you are purchasing has premiums you can afford long term.  You are better off purchasing a smaller policy with lower premiums you can fit into your budget.  If you purchase a policy with premiums beyond your capacity to pay, you risk letting the policy lapse due to missed payments. 
Contact your Leavitt Group insurance consultant for further guidance on determining the amount and type of life insurance that is right for you.  

life insurance, coverage, insurance, death, expenses

Reference: www.iii.org