Different Life Stages Demand Different Life Insurance Coverages – What Stage are You?
The need for insurance changes as a person enters a new life stage and insurance coverage needs to change also.
Life throws different types of financial challenges our way. All these challenges can be resolved by life insurance. Remember, financial plans need to sync with all stages of life and the requirements which are certain to each specific life stages. In short, policyholders need to continually re-evaluate their needs for adequate insurance coverage.
Below are various life stages that demand a revision in coverage:
Life insurance needs increases once you are married, so you need to hold adequate coverage to protect your spouse financially. The right time to invest in this coverage is as soon as you get engaged.
When you are planning to start a family, you will require more life insurance coverage to protect the future of your children. So as soon as you learn of the happy news, don’t wait for the blessed event – re-evaluate your needs for life insurance.
Buying a New House
Outstanding liability goes up when you purchase a new home. If the unthinkable happens to you, then financial burden falls on your loved ones. Life insurance covers loans, property maintenance as well as property taxes to be paid in order to offer financial comfort for the policyholder’s family.
All debts such as personal loans and car loans need to be included under a life insurance policy. Remember…..It is important to leave assets for your family members and not loans/liabilities.
Promotions in your job leads to increased income and paves the path to a better standard of living. So, family members also need this increased payment in order to maintain their new lifestyle when you are not around. So, secure the needs of your family by re-evaluating life insurance requirements yearly.
Change in Marital Status
If marital status changes because of the death of your spouse or divorce, then insurance needs change too. Your family completely depends on you, not only emotionally but financially. In fact, at this point, you will also have to make important changes to the nomination of beneficiaries of your current policy.
Life insurance policies play a key role in the life of growing children especially those who are studying abroad for expensive courses like medical, engineering, MBA etc.
The function of life insurance is to protect family members from the loss of income if you or another primary wage earner were to pass away. It may seem counterproductive to give up having life insurance after so long, but the truth is , you may no longer need it. As far as estate planning goes, you could very well need a different type of policy or major changes to your current one anyway.
- If you retire and don’t have issues paying bills or making ends meet you likely don’t need life insurance.
- If you retire with debt or have children or a spouse that is dependent on you, keeping life insurance is a good idea.
- Life insurance can also be maintained during retirement to help pay for estate taxes.
Bottom Line – This is the perfect question for you to ask Steven.
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