5 Reasons to Get Life Insurance
There is a bit of ambiguity when it comes to the need for life insurance. Other insurances, like that for your home or car, are certain necessities. But should you really get life insurance or not? Below are five reasons when it is definitely worth it and when it is not.
- Secure your children.
Life insurance is almost a necessity if you have children. Unless you have significant savings in the bank or your retirement accounts, your life insurance is the only guarantee your children will be looked after no matter what. Kids are expensive and it is best to have their care protected and insured.
- Buy it if you need to replace your income.
Having life insurance is not just about having a cushy windfall for your family in case of your death. Of course, this is an excellent advantage, but it is also about protecting yourself, your assets and your lifestyle if a disaster strikes. You will need life insurance if someone is relying on your income, but if you do not have kids or share a property, you do not need it. Buy it though if you are married and foresee that one will have a difficulty making ends meet in the event of an untimely death.
- Get it for yourself, not your dependents.
As mentioned, the purpose of life insurance is to replace income. If your dependents do not bring in income, they do not need it. If you are thinking about investing on your children, you will do better with a college fund or creating an emergency fund.
- Choose a term policy.
Cheaper and more affordable, you can set up a term policy to cover you for as long as there are dependents on your income. It can be bought for 10, 20, or even 30 years. A whole term is also available but this is more expensive, sometimes 10 times more than term! Its cash benefit also accumulates slower than if you invested your money elsewhere like the stock market.
- This is for peace of mind.
At the end of it, life insurance is not about buying a policy but buying peace of mind. Having this measure of protection certainly takes away plenty of stress. If you are single or do not have children, there is possibly no need for it. But if you have dependents, life insurance can really help you big time.