Life insurance is not solely based on death, but many people buy life insurance only for the purpose of paying for a funeral.
When contemplating how much life insurance to buy, a person needs to look their overall debt-to-income ratio (i.e., how much do you really make vs. how much do you really owe?). If what you owe far exceeds what you make, your life insurance needs to match that deficit plus a 35-50% increase. The purpose of the increase is to account for additional unsecured debt such as credit cards, student loans, car loans, etc.
Have you successfully calculated how much insurance you need? Do you understand the formula? When was the last time you calculated it? Have you experienced another life event since then (additional children, new home, new marriage)?
Life insurance has many primary, additional uses other than simply paying for a burial. It can sustain a lifestyle, pay for an education or for extended living facilities, and it provides tax-free retirement withdrawals.
How are you using your life insurance? Call or email our office today to learn how much life insurance you actually need, and how you can better protect your financial future!
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