Life insurance is something that almost everyone needs and not having it when you need it can be devastating to your family’s well being.
Let us look at the senior market for final expense whole life insurance.
Have you thought about the financial burden you would impose upon your family to cover funeral costs, which average over $10,000 today according to the National Funeral Directors Association?
Other funeral expenses that would drive the cost higher are paying for the cemetery plot, monument, flowers and obituary.
Many companies offer grants, legal advice and additional benefits with your final expense insurance.
The insurance policies to be bought range from $10 to $35,000 face value on your death benefit Purchasing life insurance when your young is a smart move towards your financial future because your premiums are much lower, your rate can be locked in for a period of time, and some policies let you build your cash value over your whole life.
There are other reasons for buying life insurance being the need for money to pay for school or even fix up your new home, car or apartment.
With Life insurance you can borrow against the cash value at a very low interest rate and have the luxury to pay it back when you can over time.
But remember you are borrowing against the death benefit which becomes lower if you do not pay it back.
Another major reason to buy life insurance is when you have a family with children that depends on your income to pay for expenses such as the mortgage and car.
Your life insurance eliminates the need in having to deplete your savings in order to pay these expenses.
Most start with a simple term life insurance but others either convert it to permanent which creates a cash value or buy more term and some permanent while converting term into permanent through the years.
Many people would think that a $250,000 20 year level term policy for a healthy 30 year old would cost $1,000 a year or more when it actually would cost about $150. Let us look at a child with special needs and how life insurance can help with a trust fund set up for them.
An individual or third party is permitted to transfer personally owed assets or with a third party as with estate gifts on a tax free basis.
In some trusts there is no age limit or Medicaid payback requirement at death. The benefits of using life insurance in a special needs trust fund is that It can be used to equalize an inheritance or create liquidity for the future needs of the special needs child.
Other benefits would include providing cash to fund the trust over a lifetime to enhance and supplement the benefits provided under government programs.
If you own a business you must have a business continuation plan in place which is an arrangement between business owners that provides for shares owned by one of the owners who dies or becomes disabled to be sold to, and purchased by, the other owner / owners, or the business.
Life insurance bought on each owner of the business pays the remaining owner cash while not upsetting the continuation of the business as well as paying off the deceased owners heirs.
In addition a key person in your business who has specialized skills, knowledge, or business contacts is a valuable asset to any business.
Protecting that asset can be done by taking out a tax free life insurance policy on that key person so upon the key persons death the business would have a cash benefit to continue to run the business while giving the owner time to look for a replacement.
You can also purchase an executive bonus life insurance policy on the key person employee that would in effect give him a wage increase in the amount of the premium paid while the employer would be in control of the policy.
Since the employer treated the wage increase as bonus it is tax deductible to him and income taxable to the employee.
Those are some of the good reasons why you should buy Life Insurance.
Please contact Medical Solutions NY if you are interested in any of these related life insurance plans!