The most common and obvious reason people get life insurance is to protect their family in the event of their untimely departure from the realms of men. And there is no better way to do exactly just that! Without life insurance, you could burden your loved ones with repayment of loans, mortgages, as well as the cost of living expenses and the ever-increasing education prices for children. If you die, it would be burden on them enough. Allow them some relief by making sure they don't have to worry about money right away.
Life insurance will also cover the costs of your funeral, so your family can focus on grieving and remembering you well, not struggling with the cost of your death.
It's also an investment. Several different types of life insurance policies allow you to invest the money you put into an account, either in stocks, bonds, or mutuals, and several others will simply accrue interest from their account. Rather than risk losing everything, as you would in the stock market, you can purchase a guarantee that a certain amount will always be available for the death benefit.
All of that is tax-free as well. You don't pay for your life insurance policy, even as it accrues interest. Can you say that about any other portfolio?
Some people naively think that they will be able to simply stash money away for their family upon their death, but it doesn't really work like that. If the money comes from anything but a life insurance policy, the federal government, state government, and even your city all have a potential to dip their paws in the honey pot. When a spouse is the beneficiary of a life insurance policy, it is not taxable.
Plan for your retirement with a life insurance policy. With some types of policies, you can withdraw the money you've put in, minus a fee, at any time. With others, you can get all of the money you put in, plus interest, when the policy matures at retirement. Often you get the entire death benefit paid out, which many choose to take at their retirement. What a gift! What would you do with all that guaranteed money on retiring?
Take steps to get the most bang for you buck by shopping wisely. Life insurance quotes help with this, but you must also honestly assess your life insurance needs and financial ability. Consider allowing yourself some flexibility with variable life insurance.
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The Consumer's Guide to Life
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