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We often hear that life insurance is prohibitively expensive. But if you buy the right kind of life insurance, you might realize how wrong that statement is.
Whole life insurance can be very expensive, but term life insurance tends to be much more affordable. Sure, there’s a reason for that. Whole life insurance has an indefinite term, while term life insurance expires after a certain period of time.
Whole life insurance policies also accumulate cash value that can be redeemed or borrowed as needed. With term insurance, if you don’t die by the end of the policy period, you get nothing (other than being able to live on).
Many people who buy life insurance end up with term insurance because of the cost difference. Also, if you are planning to do the same, you should choose a period that is suitable for your coverage.
Many people have 20 or 30 year life insurance. But should you go that route? Or is 10 year term life insurance enough?
Discover: Save on life insurance with one of these companies
MORE: Check Out Our Top Picks for Life Insurance Companies
What kind of protection are you trying to give your loved ones?
The purpose of life insurance is to help your loved ones receive financial assistance while you are away. The number of years of support you want to provide also determines the type of term insurance you purchase.
Suppose your oldest child is five years old and you apply for term life insurance when your youngest child just turned three. It’s natural for her to think she’ll be financially independent once her kids are out of college and into the workforce, but that often doesn’t happen until she’s about 22. A life insurance contract is concluded. That way, even if you die soon after taking out life insurance, you can still support your child until he or she becomes a full-fledged adult.
But let’s say your situation is different. She may not have had life insurance when her kids were little, but she’s a teenager now. In that case, a 10-year life insurance policy would suffice.
Or maybe you don’t have children at all. You are married, your spouse has decided to retire in her 50s to care for an aging family member, and your spouse is insured until he reaches Social Security age. We want to make sure that you are. In that case, the senior citizen can start receiving social security from the age of 62, so 10 years of term insurance is enough.
Do not buy more life insurance than you need
If you’re confident that 10 years of term life insurance will provide enough protection for your loved one, there’s no need to purchase coverage after that. The shorter the insurance period, the cheaper the insurance premium. And the less money you spend on them, the more money you’ll need to spend on retirement savings, your kids’ college funds, and other financial goals on your list.
Recommendations for the best life insurance companies
Life insurance is a must if you have someone to rely on. We’ve combed through your options to create a list of best-in-class life insurance coverage. This guide We help you find the right life insurance company and the right type of insurance to meet your needs. Read today’s free review.
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