Who Needs Life Insurance?
If you are married, most couples depend on two incomes to make ends meet. Life Insurance makes sure that your plans for the future don’t die with you. If you are a single parent, you are probably also the bread winner, cook, chauffeur and so much more. With so much resting on your shoulders, you need to make sure you have enough Life Insurance to safeguard your children’s financial future. You work a lifetime to accumulate an estate, however, at your death, the asset you pass on to your heirs maybe subjected to Federal Estate Taxes and State Inheritance Taxes. If your estate is subject to estate taxes, taxes are due usually, within nine months of your death. Life Insurance can play an important role on Estate Planning by providing the funds necessary to pay estate taxes and expenses and provide liquidity so these expenses can because paid. Some expenses that must be paid upon an individual’s death maybe include, but are not limited to Federal Estate Taxes, State Inheritance Taxes, Prob
Your need for life insurance varies with your age and responsibilities. It is a very important part of financial planning. There are several reasons to purchase life insurance. You may need to replace income that would be lost with the death of a wage earner. You may want to make sure your dependents do not incur significant debt when you die. Life insurance may allow them to keep assets versus selling them to pay outstanding bills or taxes. Consumers should consider the following factors when purchasing life insurance: • Medical expenses previous to death, burial costs and estate taxes; • Support while remaining family members try to secure employment; and • Continued monthly bills and expenses, day-care costs, college tuition and retirement.
If someone depends on you financially, chances are you need life insurance. Life insurance provides cash to your family after your death. This cash (known as the death benefit) replaces your income and can help your family meet many important financial needs like daily living expenses, mortgage payments, and college savings. What’s more, there is no federal income tax on life insurance benefits. Most Americans need life insurance. To figure out if you need life insurance, you need to think through the worst-case scenario. If you died tomorrow, how would your love ones fare financially? Would they have the money to pay for your final expenses (e.g., funeral costs, medical bills, taxes, debts, lawyers fees, etc.)? Would they be able to meet ongoing living expenses such as the rent or mortgage, food, clothing, transportation costs, healthcare, etc? What about long-range financial goals? Without your contribution to the household, would your surviving spouse be able to save enough money to
