You need life insurance. That is a fact. The last thing you want is for your family to be left in the lurch if you pass away. There are plenty of different options out there for affordable life insurance. We are going to walk you through everything that you need to know about these policies.
Why do you need life insurance?
The purpose of life insurance is to provide your family with financial support when you pass away. This is going to be important if you are the main moneymaker for your family. It means that they will be able to continue to afford food, your house etc. If you do not have any dependents, then it is unlikely that you will need life insurance. There will be nobody to receive the money, unless you stipulate otherwise.
Basically, if somebody relies on you financially, then you will almost certainly want to look into affordable life insurance.
Types of Policy
When it comes to affordable life insurance, or any type of life insurance for that matter, there are two types of policy that you can choose from:
- Whole life insurance policy: this last from the day you start paying into the life insurance policy right until the day you day. Of course, you are going to need to continue to pay into the life insurance policy during that time. If you fail to pay into the policy for a period of time (normally a very short period of time), then you will lose your policy. The major benefit of this policy is that your premiums are fixed. They are not going to change, even if you become the victim of poor health.
- Term life insurance policy: many people find that a term life insurance policy is going to be better for them. This is almost certainly the most affordable life insurance option. You will be purchasing the life insurance policy for a specified period of time. Normally ten or twenty years. At the end of that time period, you will need to purchase a new policy. This option is going to be ideal for those who may not have people who will be financially dependent on them in a few years. For example; once your children have left home, you probably do not need to have a life insurance policy.
How Much Life Insurance Do You Need?
This is going to be dependent on your own individual circumstances and we suggest that you do a bit of research here. Obviously, the more you are insured for, the more you are going to need to pay for your policy. If you insure yourself too much, then it may not be affordable life insurance that you are getting!
We recommend trying to work out the amount of money that your family will need to live on comfortably if you died. This should give you a good baseline for the amount of life insurance you should be purchasing for yourself.