How Does Life Insurance Work and When is a Good Time to Consider Life Insurance?
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July 6, 2023
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If you haven’t yet ticked getting life insurance off your to-do list, we understand why you might procrastinate: It can be a bit of downer to think about, and the choices can be overwhelming when you don’t know quite how life insurance works or what level of coverage you need! But the decision can be one of the smartest things you can do to ensure your loved ones cared for after you’re gone.
What is Life Insurance?
Life insurance is a legally binding contract with an insurance carrier that, in exchange for making the required premium payments, a lump-sum tax-free payout (also known as a death benefit) will go to a specified beneficiary or beneficiaries, when the insured person dies.
When is a Good Time to Consider Life Insurance?
While milestones are a great starting point for consideration - a new house, starting a business, getting married, starting a family - the truth is there are endless reasons that you may consider life insurance and talking to Statera Financial Planners is a great place to start! We can help you look at all of the personal circumstances in your life and help determine if you may or may not need to look further at the options for life insurance.
What Can Life Insurance Help Me Cover?
Death is already an extremely stressful time for your loved ones, who have a lot of important decisions to make regarding your estate and final wishes. Life insurance can provide money quickly to help cover the immediate expenses.
- Legal fees and
- Funeral costs
- Taxes
- Student or car loans
- Mortgage payments
- Credit card bills
- Child care
Beyond meeting these immediate needs, life insurance can also help you:
- Ensure that your loved ones will be financially secure for the future and ongoing lifestyle plans.
- Set your children up for success through an educational fund.
- Leave a legacy by supporting the causes and charities you care about.
- Transition your business by covering ongoing expenses and replacing lost income.
- Protect the wealth you’ve grown over your lifetime.
It’s never too soon to start considering insurance. In fact, being young and healthy has its advantages when it comes to life insurance:
- Your payments are usually lower.
- If you get life insurance now and develop health issues later in life, you’re already covered.
- You have more time to grow the value of your policy, depending on the type of life insurance you get.
Don't hesitate, talk with Statera Financial Planners today and they can help you run a full insurance analysis to see what gaps may exist and where life insurance may be able to help!
As financial planners, we do not provide specific tax and legal advice. You should always consult your accountant and/or lawyer where necessary. Because of the many ways a strategy may be impacted when segmented, we prefer to communicate collectively with your external professionals to ensure that all recommendations and action plans are in the overall best interest of you, with your professionals working with common goals in mind.
You are never obligated to act on our recommendations of products, services, or advice.