Jacksonville, FL (PRWEB) September 28, 2012
Life insurance can do some pretty amazing things for people. It can buy loved ones time to grieve. It can pay off debts and loans, providing surviving family members with the chance to move on with a clean slate. It can keep families in their homes and pre-fund a child’s college education. It can keep a family business in the family. It can provide a stream of income for a family to live on for a period of time. Life insurance can do all of these wonderful things for your family…there’s just one small catch. One needs to own life insurance.
Let's be honest, life insurance does not get a lot of attention in our daily lives. It requires us to address a subject that many prefer to avoid -- our own death. Yet, for most people life insurance is important for building a strong financial plan, and it's something that shouldn't be ignored.
"I've seen certain themes emerge based on countless discussions with my clients about life insurance. Some of them get tripped-up on which type of policy, term or cash value, is most appropriate for their situation. Others may have misconceptions about how much life insurance coverage is needed. The best place to get answers and to shop the market is Firstoptioninsurance.com."
Over the course of any discussion, a light bulb goes on when clients are asked a very basic question: "What would happen if I died? How would your family live without your income?"
Life insurance is often a taboo topic, even within families. While this can be a sensitive issue, even between couples, there needs to be open communication.
For those interested in securing life insurance coverage but having trouble getting started, here are some of the common questions from my clients, along with a few thoughts that may help guide you during the process.
1. How do I calculate how much I need? While seven to ten times your annual salary is a generally accepted rule for coverage, it's best to conduct your own personal needs analysis. Countless online calculators may give you a rough sense of your needs. Yet, it's important to dig deeper and consider the following variables, which, when added together, will get you closer to your real number. Consider final expenses, which are one-time costs such as for the funeral and burial. In addition, factor in outstanding debts that need to be paid off and re-adjustment expenses that arise during transition, such as shifts in child care, housing or medical insurance. Parents need to take into account dependency expenses to cover a family until all children are self-supporting, as well as education costs to help with college tuition for each child. Don't forget to properly insure a stay-at-home parent or someone working part-time; their unpaid contributions to the household could result in significant additional expenses if they were to die. A final variable to take into account is providing lifetime income to the surviving spouse.
2. Who else do I need to involve in this decision? Life insurance is not a stand-alone decision. It is a selfless act that protects the future of your family, yet can bring up difficult emotions. Anyone affected by the policy should be involved in conversations and understand the rationale behind the amount of coverage. It is often helpful to have the conversation after doing some homework about coverage options first -- whether that work is done through the workplace, a financial professional or independently. Your spouse or partner should be involved and additional family members may also need to be involved, particularly adult children or parents.
3. When should you purchase life insurance? Major life events are good reminders for us, and they often trigger a life insurance purchase. These include marriage, buying a home and having children. Keep in mind that the younger you are and the better your health status, the cheaper the premiums can be.
4. When should you re-visit your existing life insurance? Life insurance is not a "one-and-done" decision. Like many other long-term investment decisions, life insurance should be viewed on a continuum that reflects your current situation and stage in life. As a baseline, it's helpful to review your existing coverage every few years or when a "life event" occurs.
5. How and where should you obtain life insurance? There are a variety of ways you can obtain life insurance. Term insurance is recommended. http://www.1stOptionInsurance.com will shop the top carriers to find the lowest priced life insurance based on your individual needs, and from the reviews, customers are very pleased with their service. You can work with a financial planner but most of them direct you to a friend who only represents one life insurance company and can’t shop the market of 25 top rated life insurance companies like http://www.1stOptionInsurance.com.