When it comes to long-term financial planning, life insurance can become a part of it. And it can be vital for your economic stability regardless of your marital status, kids, age, and personal goals. Usually, employers provide health insurance coverage and, sometimes, life insurance too. But you can benefit from it only if you continue to work at the same place. Once you leave the existing company, the benefits will also become invalid. That’s why it is ideal to invest in an additional life insurance policy to avoid any risk. Many people don’t pay much heed to this because they find it expensive, while the truth is they end up calculating at least three times more than the real cost. According to experts like Michael Osland, you should learn about this policy’s benefits and then decide. Here is a quick look into them.
Why should you consider purchasing life insurance? By Michael Osland
Having this type of coverage can be excellent for your family’s financial stability when you are not around. Your family members can enjoy various benefits if you have more than one. The workplace life insurance policy can pay a small sum of $25,000, which they can use for funeral expenses and debts. However, the benefits can multiply if you opt for one more policy. It can pay the home loan, car loan, student loan, credit card bills, kid’s education, care services for aging parents, and others.
Michael Osland remarks life insurance can also dole out tax advantages. There can be no tax on death benefit payments. Your heirs may also have to pay considerably lesser tax amount because of certain features of the policy.
Besides, some life insurance plans offer cash value after a certain period; you can use it to clear your premiums or lead a retired life. Some bundle it with other coverage types like a disability plan if they cannot work and earn more.
Types of life insurance
There can be typically two choices – term and permanent life insurance. Term policies don’t cost much and are easy to understand; you can also transition from it to a whole or permanent life policy. However, for this, you need to have clarity about terms and conditions. If you cannot continue this policy, you can stop paying for it. In the end, you will only lose the amount you paid for its premium.
On the other hand, permanent life insurance offers cash value to withdraw or use for borrowing. It can come in handy during estate planning also.
Buy your life insurance coverage when you are healthy and young. You can get one for a lower price for various reasons. First, a young and healthy person can expect to live longer. The chances of ailments also remain lower. And finally, they can be a good source of premium amount collection. However, it doesn’t mean you cannot get good options beyond age 20. You have to examine more and, at the same time, understand your basic requirements well. In essence, buying life insurance can be rewarding for you and your family if you invest in the right plan at the right time.