Options for Your Life Insurance

356 days ago

There are many options for life insurance. One option, of course, is to not have any at all. There are benefits and disadvantages to life insurance so it is important to know what you need. This article considers the options and which ones might be right for you.

Funeral Cover

One cost that it seems very wise to cover is that of the funeral. Funeral insurance is relatively cheap and it takes a huge amount of burden from your family’s shoulders when you pass. By creating a fund for your funeral, you can both ensure that you can get what you want and ensure that your family will not have to struggle with financial difficulty when you first depart. The immediate costs of a funeral can otherwise be very damaging to finances because around $15,000 needs to be produced within just a matter of weeks.

Life Insurance

Life insurance is usually used to ensure that your family remains with a roof over their heads and food in their bellies once you are gone. Whilst life insurance is expensive, protecting the ones that you love after your demise seems to be a very worthwhile endeavour.

There are many different types of life insurance but it is clear that yours needs to do a few things. It will need to clear any outstanding debts, it will need to provide at least three years worth of income to allow time for your family to get back on track, and finally it will need to fund the education of your children. It is very important to look at a range of life insurance quotes when applying for such insurance policies so that you can get the best deal for your cover.

Savings

Making savings is another great way to achieve a level of support that insurance would otherwise offer. If you are able to make large cash reserves then this is actually a better way to prepare for your death. By investing in high interest savings accounts, you will be able to greatly increase the rate at which your savings grow and you may be able to benefit from them in life as well as after your death.

Investments

Investing in stocks, property and shares is a great way to generate wealth. This practice can also be used to save for your family in the case of your death too. Having a large portfolio of properties or stocks will actually enable you to create a steady income for your family which will continue long after your death. This income will serve as an excellent support system for the ones you love and it will make it as though financially you never stopped contributing at all.

Insurance vs Savings & Investments

Having insurance in many ways seems less effective than having a large amount of savings. There are some downsides to savings and investments, however. Investments are of course liable to crash and this could potentially mean that you lose your income and your ability to support your family after death. Insurance, however, will remain in place regardless of the property or stock market.

Whilst savings and investments will allow you to quickly accrue wealth, insurance will act as a permanent safety net. The fact that it cannot be reached, even in times of hardship, means that it will always be a source of protection to your family. Having huge amounts of wealth will obviously also offer this safety net, but not all of us are so lucky.