My father died when I was nine years old. He left behind my mother and four children between the ages of seventeen and nine and had no money. Surely I missed him but at nine o'clock I really didn't have much idea about death or loss. I know it sounds selfish but what I really missed was our old lifestyle. We had to move house because we lived in a company house and could no longer live there. We had to leave our car as it was also provided by the company.
All we could afford was a run down council house. It was short and tight and there was not much in the way of the fence so we felt that the neighbors above us were right. All this was salt for our wounds, these were all such disgusting things which have become our lives now. I don't know why my father didn't take life insurance, I know he didn't and we were bored of the consequences of that decision for a long time.
It made me wonder why so many people turn their eyes when the term life insurance is spoken aloud. Certainly I can understand that one should not consider a scenario that you or your family will really need but this is no excuse to completely ignore and not plan ahead. Just think, if your family's life is the worst for a moment and you don't have life insurance?
The purpose of life insurance is to guarantee an income to your spouse and children, if you are no longer able to contribute to their welfare, like you do. Think about it, if something was going to happen to you, could your family live in your current house? Will there be enough money to maintain their current lifestyle? Will funeral costs become a burden? Will your spouse be able to support your family easily? Or will you cause unprovoked pain due to stress and sorrow and financial burden?
Maybe you think that because you have saved and invested wisely and have built a solid foundation that will be financially sound for your family despite your missing. The reality is that this is unlikely. This is especially true for families with young children. This is often a time where families are still struggling to get established and often debts are high, savings are low, care for children is expensive and income may not be at its peak or perhaps a partner. Is out of the workforce to care for children. Of course, this is a time when funds are often drawn that life insurance is most needed but often this fact keeps families away from the regular commitment of insurance premiums.
But the good news is that it makes you a good candidate for life insurance as it is the cheapest form of life insurance. The premium for life insurance is worked out based on your age and health and is usually purchased in terms of the number of specific years - 1, 5, 10, 20 or whatever term you would prefer. This is that the term life insurance has the highest coverage for the lowest premium.
While term insurance is not ideal for older individuals as prices increase substantially with age, it is a great solution for young couples or families who have high debt, including mortgages, living expenses, and dependents. Insurance can cover you as your children grow up and the mortgage is paid off. By the time the policy expires, you have overpaid your investments, paid off your major debts and are no longer dependent.
So who needs to be covered with a life insurance policy? Given that insurance is really about income protection - providing money when you can't - you will normally cover whoever is contributing to the family's finances. So first, make sure that the primary income earner is covered. If this income has disappeared, then you want to ensure that the ongoing needs of the family are met.
But don't stop there. If your spouse takes care of the children full-time and something is going to happen to them, how will you fund childcare? Insurance can cover that additional cost. Therefore if any secondary income is relied upon to cover expenses through income or unpaid contributions then that person should also have an insurance policy.
Do you need life insurance for your children? Generally, it is only advisable if you cannot afford the funeral (usually around $ 5000). Otherwise, there is no reason for children to have insurance because they do not contribute to the family's income.
Getting life insurance not only gives you mental peace, but your family will have to take care even after you or your spouse leave, this can be the best financial decision for your family.
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