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Life
Insurance
Along with your savings
and investment strategy, life insurance
should be part of your long-term financial
planning.
You may not like
to think about it, but your death can be
costly to your loved ones. At the very least,
there will be funeral and burial costs.
There may also be estate taxes and outstanding
debts to pay, such as medical expenses not
covered by health insurance. If you have
dependents, they will have to cope with
these costs while no longer having your
income to rely on.
The proceeds from a life
insurance policy can be of tremendous value at
this time. It will provide economic assistance
to your family so they can pay off the mortgage,
college tuition and other ongoing expenses and
maintain their current lifestyle.
While there a many different
types of life insurance policies, they generally
fall into two categories – term and permanent.
Term
Term Insurance is the simplest form of life insurance.
It provides financial protection for a specific
time, usually from one to 30 years. These policies
are relatively inexpensive and are well suited
for goals, such as insurance protection during
the child-raising years or while paying off a
mortgage. They provide a death benefit, but do
not offer cash savings.
Purchasing term insurance
is like renting a home. It is a short-term solution.
Monthly costs are usually lower, but you will
not be building equity. Just as many people rent
(while saving to buy a home), individuals who
need insurance protection now, but have limited
resources, may purchase term coverage and then
switch to permanent protection. Others may view
term insurance as a cost-effective way to protect
their family and still have money to put into
other investments.
Permanent
Permanent insurance (such as universal life, variable
universal life and whole life) provides long-term
financial protection. These policies include both
a death benefit and, in some cases, cash savings.
Because of the savings element, premiums tend
to be higher. This type of insurance is good for
long-range financial goals.
Purchasing permanent insurance
is like buying a home instead of renting. You
are taking care of long-term housing needs with
a long-term solution. Your monthly costs may be
higher than if you rent, but your payments will
build equity over time. If you purchase permanent
insurance, your premiums will pay a death benefit
and may also build cash value that can be accessed
in the future.
Contact
Dynes for more information >
Read
what people are saying about Alan R.
Dynes Insurance. |
