Getting the life insurance coverage your family will need isn’t that difficult, though there are several myths that would suggest otherwise. Knowing the truth will help you to get the best coverage at rates you can afford. Learn the truth about life insurance from the responses to these 10 common myths.
Myth No. 1: Since my employer provides a Life Insurance Policy, I don’t need another one.
If your employer provides you with a life insurance policy, you are quite fortunate. However, be mindful that policy is only a temporary one. In most cases, once your employment ends, so does the policy. Even if you plan on working at the same place until you retire, you will need a policy that will follow you through wherever life takes you.
Another fact to keep in mind is that most companies provided policies are for the equivalent of your annual income or less, and many are only intended to cover funeral expenses only. In the event of your death, there will likely be several bills that your loved ones will need to be able to pay off. Those expenses may include medical bills, mortgage loans or other debts. Many experts advise having at least 10 times your annual income in your life insurance policy.
If you need help figuring out how much you need, download and fill out this form.
Myth No. 2: Life insurance is too expensive for me to afford.
FACT: The cost of life insurance has come down considerably over the last few years, making it affordable for just about anyone. In fact, you can get monthly rates as low as $11 per month for a $250,000 policy. Many people could simply forgo their daily soda and be able to make sure their family will be taken care of once they’re gone.
Myth No. 3: You have to be in near perfect health to get life insurance.
FACT: Several companies offer policies that take into account many health conditions. In fact, there are many companies that specialise in such policies. Though some of these policies will be more expensive, a well-trained agent can help you to get the coverage you need at a reasonable rate.
Myth No. 4: Term Life insurance is the only kind you need.
FACT: Term Life insurance can be a great choice if you only need coverage for a specific period of time. Because it is a temporary solution the premiums are typically lower than a permanent or universal policy. A well-balanced portfolio would have both **** term and permanent policies.
Since the accumulated value of a permanent life insurance policy may be income tax-free, it can be an extremely valuable piece of your total financial plan. Though the premium may be higher, you get far more per dollar by going with a permanent policy in comparison to a term life policy.
It is also important to note that as you get older, term life policies become more expensive and will require you to pass a health exam to keep them with no changes. A term life policy may be a good fit though, for while you have children living at home and you survivors would need more money to get by. – doesn’t quite sound right
Myth No. 5: You only need Life Insurance after you have children.
FACT: Once you have children you will want to be able to leave more **** for your family. But even if you don’t have children, there are several expenses that will need to be covered in the event of your death. Even a small policy to help your parents or other family members to pay for your funeral expenses will be much appreciated.
Myth No. 6: My lifestyle doesn’t impact my premiums.
FACT: Your lifestyle is probably the single most influential factor when determining your premiums. If you smoke, drink excessively or engage in other detrimental lifestyle choices, you will see your rates go up.
Myth No. 7: Only the primary money maker in the home needs to be covered.
FACT: There is more to consider than just loss of direct income when deciding on life insurance. Even if one of the couples stays at home, they still at least support the other in their ability to make money. Some expenses that will come up can include funeral expenses, daycare, and loss of income during bereavement and housekeeping.
Myth No. 8: Only older people need to have life insurance.
FACT: None of us know when we’re going to die or how we’re going to die. That is why life insurance exists. When you’re young you may not need as much insurance as you will as you get older and have greater responsibility, but you should still have proper coverage so your final expenses aren’t a greater burden on your family.
Another important fact to consider is that when you are young and in good health it’s easier to qualify for a good life insurance policy. The rates will be lower for a bigger policy.
Myth No. 9: Life Insurance can only benefit your family once you are dead.
FACT: Many permanent life insurance policies have great benefits available when you are still alive. Some offer cash withdrawals or tax-free loans for education and other large expenses. Some policies even double as retirement accounts.
Myth No. 10: Once you have a policy you can stop thinking about it.
FACT: As your life changes, so should your insurance policy. If you buy a house, you’ll want to make sure that your coverage can pay off the loan if you died. As you have children you should expand your coverage to provide for them. If your standard of living changes, those changes should be reflected in your policy. Remember the guideline that your policy should be for roughly 10 times your annual income.