Whether you are starting to build a family of your own or you already have one, it is important to prioritize their welfare.
If you have kids, you want your kids to have all the opportunities possible to them. You also want to live a long life with them. Not to mention that you would want your parents to retire without worries.
Overall, you want to find ways to protect your family. However, there are instances where it is no longer possible. For example, if you have an untimely passing, it is much more challenging to ensure that your family is going to be okay.
One way to help protect your family just in case you pass away is by having life insurance.
Life insurance is a contract between you and an insurance company. By paying for weekly, monthly, or yearly premiums, an insurance company has a contractual obligation to provide your chosen beneficiary with a lump sum of money should you pass away.
With the help of life insurance, you can provide a financial cushion to your family even when you’re not there. To elaborate further, here are four particular ways that life insurance can help protect your family in the long run:
1. FINANCIAL SECURITY
One of the most difficult things to cope with for a family who has lost a significant household provider is the reduction of financial security. It doesn’t help that funeral costs and hospital bills can add a lot of sudden expenses that your family needs to pay off.
During these trying times, you can help your family by providing them with financial protection. You can give your family that extra financial cushion by having a good life insurance policy that they can claim upon your death.
It can help pay off the costs of the funeral and hospital bills, and the remaining amount can help your bereaved loved ones to start again. Even if it’s a small amount, it will still certainly be a massive help to your grieving family.
2. DEBT REPAYMENT
When you pass away, it’s not only your family that you are leaving behind. Unfortunately, in a lot of cases, the debts that you haven’t paid off will go to your family instead.
Given the other financial concerns that they likely have to deal with upon your passing, this can be a severe load added on their shoulders.
If you want to help ease the burden of your family, then you should get yourself a reliable life insurance policy. When your family receives the life insurance cover, they can use the money to pay off the debts that you left behind.
Mind you, the death benefit can pay off a lot of debts like credit card loans, mortgage, and other personal loans you may have left behind.
3. EDUCATION FUND
There’s nothing worse than leaving behind your kids and reducing the significant financial support that can help give them more opportunities in life. This includes the money that’s meant for their education.
Thus, if your family gets your life insurance benefit, they can then use it for building an educational fund for your kids.
There are specific life insurance policies that are both a death benefit as well as a savings account. In this case, you can also use the additional savings account as a way to save up for the education of your kids, even while you’re still alive.
4. PEACE OF MIND
One of the biggest worries that people have is their future, as well as the future of the people that they love.
These are two of the most significant issues that concern people. They are the kind of concerns that can leave a person awake at night. Therefore, you should do something to help ease this concern a little bit.
With life insurance, you add a certain level of protection for your family and increase your peace of mind. Knowing that you aren’t adding any financial burden to your family upon your passing is going to help you live a more relaxed life filled with fewer anxieties about the future of you and your family.
PRINCIPAL TYPES OF LIFE INSURANCE
It’s important you compare life insurance policies first before you make a purchase. There are also other factors that you need to consider.
You can base your decision on the coverage that you want: Term insurance versus Whole Life insurance.
Choosing between the two will depend a lot on your personal preferences. One way to help you decide is by checking out your financial goals as well as your current financial capabilities. Each insurance type requires different things out of you while providing varying benefits.
On that note, let’s define and differentiate Term insurance and Whole Life insurance and how each can benefit you:
TERM INSURANCE
The most basic form of life insurance is Term insurance. It provides a shorter coverage (hence the name), which means that there is only pay-out if the death occurs within a specified period.
For example, your family can reap the benefits of your life insurance in case your pass away before you turn 88 years old.
The great thing about term insurance is it’s a lot more affordable, especially for younger people. However, it won’t provide as many benefits as Whole Life insurance.
WHOLE LIFE INSURANCE
Whole Life insurance, on the other hand, provides coverage for the entire life of the policyholder.
You can get one with or without a medical examination, but for a higher cost. It’s also a lot less affordable than Term insurance, so people with lower financial capabilities might not be able to afford it.
However, it provides benefits such as accumulating cash value that you can use while you’re still alive.
Conclusion
Life insurance is an investment that is meant to help the people you love in case something unprecedented happens.
Being prepared for the inevitable is not only going to give you the peace of mind to live a full life, but it’s also going to help protect your family, especially during the initial days of your passing.
If you don’t have a life insurance policy yet, then check your financial capability. After that, connect with an insurance agent so that they can help you figure out how their policies can help.
Make your decision once you’ve checked out your options, then reap the rewards of your life insurance when the time comes.
