Life Insurance
One of the most vital purchases you’ll ever make is life insurance. Life insurance proceeds can help pay bills, continue a family business, finance future needs such as your children’s education, protect your spouse’s retirement plans, and much more in the event of a tragedy. If you’re considering securing your and your family’s financial future, we’d be happy to review your current situation and offer suggestions on how to do so!
Types of Life Insurance
TERM INSURANCE
When first purchased, term insurance is the most affordable type of insurance and is intended to meet temporary needs. It protects you for a set period (the “term”) and generally pays out only if you die during that time. Therefore, this type of insurance is useful when you need coverage that will expire at a specific point in time. For example, you may decide that you only need coverage until your children graduate from college or until a specific debt, such as your mortgage, is paid off.
FINAL EXPENSE
Loans, credit card debt, estate costs, and funeral expenses are some of the expenses that most people leave unpaid when they die. If left unattended, they burden their families significantly. Final expense coverage is another type of life insurance that pays off these debts after you die, ensuring that everything is taken care of.
UNIVERSAL LIFE
Universal Life Insurance was developed to provide more flexibility than whole life insurance by allowing the policy owner to transfer funds between the policy’s insurance and savings components. The insurance company divides variable premiums into insurance and savings, allowing the policy owner to adjust based on their circumstances. For example, if the savings portion earns a low return, it can be used to pay premiums instead of using external funds. In addition, in contrast to whole life insurance, universal life allows investments to grow at a variable rate that is adjusted monthly.
WHOLE LIFE
Whole life insurance is a contract with fixed premiums that includes insurance and investment. When the insured dies, the insurance component pays a predetermined amount. The investment component builds up a cash value the policyholder can use to withdraw or borrow against. Whole life insurance, the most basic form of cash-value life insurance, is a way to accumulate wealth by paying insurance costs and contributing to equity growth in a savings account where dividends or interest can get tax-deferred.