Life insurance is one of those things that almost everyone requires but far too few people have. When you’re young and relatively healthy, it’s easy to put off purchasing a policy. However, the longer you wait, the more likely something will happen before you get coverage. Perhaps purchasing life insurance has been on your to-do list for some time but you haven’t gotten around to it. Here are ten reasons why you can’t wait any longer.
1. Replace Lost Income
Life insurance provides financial security to your loved ones after you die. You must consider what would happen if you died unexpectedly. This is especially true if your family is entirely dependent on your income. Make sure you have adequate coverage. This way, you won’t abandon your loved ones when the monthly bills arrive.
2. Cover Burial Expenses
Unfortunately, even the most basic funeral service can cost several thousand dollars. While it is possible to prepay for your funeral, most people do not plan that far ahead. Pre-payment can ensure that everything is in order for your loved ones after you pass away. However, there are risks associated with prepayment. Life insurance can provide you and your beneficiaries with more certainty, relieving them as well as yourself of the burden.
3. Pay Off Debt
Your debts do not necessarily vanish just because you die. If you and your spouse co-signed for a mortgage or other loan, your spouse may become solely responsible for repayment. The other possibility is that creditors will try to collect from your estate. While this pays off your debts, your heirs will receive the remainder. Life insurance enables those you leave behind to take care of any outstanding financial obligations.
4. College Planning
There are several options for saving money for your child’s education. You might not have considered life insurance as a viable option. However, insurance payouts can be a useful supplement to your savings. If your child needs to borrow money to pay for school, the insurance proceeds could help pay off those pesky student loans.
5. Build Cash Value
Term life insurance is a type of life insurance that lasts for a set amount of time. However, another option, whole life insurance, provides permanent coverage that only ends when the policy is canceled. Whole life insurance allows you to accumulate cash value over time, which is appealing to anyone. That cash value serves as an emergency fund that you can access at any time. This could be useful if you have a financial emergency in the future.
6. Diversify Investments
Some people use universal life insurance policies as an investment tool. These policies are associated with a particular investment product. Then, based on the performance of the product, policyholders receive dividend payments. You should read the fine print before purchasing this type of insurance. You’ll be aware of the potential risks and returns before you commit.
7. Business Planning
If you own a business, you must have life insurance. This covers your obligations, ensuring that your hard work is not in vain. Are you in a collaboration with someone else? Both of you should be covered. That way, if one of you dies, the other isn’t left holding the bag.
8. Estate Taxes
When someone dies, their heirs are frequently subject to estate and inheritance taxes on any assets they receive. If you’re concerned that your loved ones will face a large tax bill, a life insurance policy can help cover these additional costs.
9. Coverage is Affordable
One of the most common reasons for not purchasing life insurance is the cost. However, most people find that coverage is reasonably priced. Term life insurance is less expensive than whole or universal life insurance. Furthermore, the younger and healthier you are, the lower your insurance premiums will be. Unless you smoke or have a pre-existing medical condition, you may be able to find coverage for as little as $1 per day. Compare policies right now to see what you can afford.
10. Peace of Mind
Nobody can accurately predict the future. However, having life insurance allows you and your loved ones to plan for any eventuality. Even with a small policy, you may find yourself sleeping better at night knowing that your family is protected if something were to happen to you.