It’s an easy question to answer in the abstract: what wouldn’t you do for your family? But as with everything, the devil is in the details…
Families interested in ensuring the safety and financial stability of their loved ones must consider purchasing a life insurance policy. These policies offer a wide variety of options to fit individual needs.
Knowing your needs for life insurance will make the process of selecting a policy much easier. For example, it’s crucial to determine whether a whole or term life insurance policy is in a family’s better interests.
Whole life is generally a more expensive option, but it also serves as a lifelong investment option that can offer considerable financial flexibility at various times of one’s life, such as during the retirement years.
A term life insurance policy offers coverage for a specific number of years, and premium costs will rise as a person grows older. It is the less expensive option for those who need basic protection.
According to the American Council of Life Insurers, the combined amount of individual life insurance protection in the U.S. clocks in at more than $20 trillion, and that number has grown at an annual rate of about 4 percent since 2010. The average American carries more than $160,000 in life insurance coverage.
Experts typically advise people to carry life insurance coverage amounting to between five and seven years of their annual income. Those experts advise additional coverage if there are other needs to consider such as children’s educational expenses.