Posted on Fri, Apr 30, 2010 @ 07:34 AM
What is the best way to assure your family's survival if something were to happen to you?
The simple answer is: Life Insurance...
There's a lot of confusion around the benefits and purposes of life insurance. But at its heart, life insurance is there to help survivors keep their lives intact if something were to happen to the main breadwinner.
Why do you need life insurance?
Life insurance has different value depending on your stage of life...
When you are younger and working, life insurance is there to provide funds to pay off the mortgage, provide income, and pay for education for the surviving family.
As you age, life insurance can be an important part of estate planning because life insurance (structured correctly) is exempt from estate tax!
What are the types of life insurance?
These days, insurance is more complicated and varied just like life itself. However, there are still two main types of life insurance:
First is term insurance. Like the name says, it has a "term" of years which the insurance covers and then it evaporates. It is the least expensive form of insurance if you are under age 50 and the term is often lined up to expire with your retirement date.
Second is whole life insurance. As the name implies, this insurance stays with you for your "whole life." The chief advantage is that in the years when you most likely will use it, you will be insured. As long as you continue to pay the premiums, it will never be cancelled.
So, what is the cost of life insurance?
Life insurance is paid by the holder in annual or monthly premiums. These premiums come down to a math formula based on the likelihood you will use the insurance.
If you are young and healthy, your premiums are less. The older you are, the higher the premiums. Of course, the younger you are, the longer you will pay the premiums...
There are a host of choices in life insurance and it would make a lot of sense to discuss these with a professional ahead of making a decision.
Of course, we know this is not a fun subject to consider but the fact is, the death rate is still 100% and quite often, the sooner you address your life insurance needs, the less you will spend over your lifetime for the protection.
Posted on Sat, Jan 23, 2010 @ 08:00 AM
We get asked quite often for tips on how to reduce the costs of life insurance so we decided to put this together... hopefully it helps:
Make a Lifestyle Change - Nothing will decrease your policy bill like a lifestyle change! Rates are lower for people who don't take as many risks... so if you want to reduce rates, try cutting back on the sky diving and smoking.
Only Buy What You Need - Consider taking a little time to determine whether your policy currently meets your needs. Although you don't want to buy too little insurance, buying more than you need can be unnecessarily expensive.
Clean Up Your Credit - People with poor credit often get denied life insurance or are put into special programs with high premiums. Clean up your credit and go back to your agent to ask for a review of your credit to lower your rates.
Consider a Rider Policy - Instead of paying large premiums by changing around your policy to include lots of extensions, consider adding on a rider policy to meet a few additional needs. This may be more cost effective than going through the process of changing your entire policy and trying to rework it to fit all of your needs perfectly.
If you have questions regarding other ways to save money on your life insurance policy, feel free to contact us at any time.
Photo by divemasterking2000
Posted on Fri, Jan 08, 2010 @ 12:24 PM
As you can probably imagine, we get calls pretty frequently asking for "end of life" financial advice. Recently, it had us thinking, "How prepared are people for the inevitable?"
We know this might not be the most comfortable topic, but it's important. How will those you leave behind handle costly funeral expenses? Funeral or burial insurance, technically known as pre-need insurance, is becoming more and more popular. Most life insurance companies and agents sell this insurance as a type of life insurance.
There are actually two different types of funeral insurance plans. The first is a single-premium policy, in which you pay for the entire benefit upfront and have full coverage from this point on. There is also a graded death benefit, in which the amount of coverage increases over time. This means it may start at 20 percent the first year and increase to 100 percent by the fifth year.
All policies will detail exactly what they cover, but for the most part, these policies will cover some combination or most of the following:
- A burial plot and care by the grave site
- Urn and Cremation
- Funeral flower arrangements
- Casket
- Grave marker
- Embalming
- Hearse and transportation
We hope this information helps. If you know of someone else it might help, please feel free to pass it on.
Photo by sridgway