Life insurance can be a crucial tool for ensuring that the people you care about will be financially taken care of in the event of your passing. A life insurance policy’s death benefit helps enable confidence and protection through trying times. We feel these insurance policies are crucial to ensuring the future of your loved ones, whether it be by paying off debt or filling the long-term financial gap left behind after death.
Choosing the Best Type of Life Insurance for You
It can be helpful to keep in mind the benefits of life insurance while considering a purchase. Its sole intent when it was created was to cover any financial losses brought on by a death. Although traditionally associated with men due to their larger earning potential in our opinion, women should now more than ever think about purchasing these type of term or permanent insurance.
When buying life insurance, the two main options are term and whole life (or permanent), often known as temporary protection policies (TPP) and cash value accumulation policies (CVA) respectively. The only similarity between the two is the desire to offer a death benefit.
Term life insurance is often chosen by people with short-term financial obligations. These policies typically have a term of 10, 15, 20 or 30 years and provide coverage for only that period of time. They are affordable and often used to replace lost income due to death or disability, cover estate or funeral expenses, and pay off debts.
Whole life insurance, on the other hand, is intended for long-term financial independence. Not only does the policy provide a death benefit but it also accumulates cash value over time which can be used to cover educational costs or retirement income needs.
Term Life Insurance vs. Whole Life Insurance
There are a few considerations to make when choosing life insurance, regardless of the type of plan chosen.
First, determine the amount of coverage needed. This amount should be based on a person’s current financial situation and any future financial commitments such as education or retirement needs. It is important to consider both the short-term and long-term needs of your family members before making a decision.
Next, decide which type of insurance is best for you. In order to make an informed decision it is important to understand the differences between Term and Whole Life policies before committing to a policy. Consider your financial goals in the short-term (i.e., debt repayment) and long-term (i.e., estate planning and retirement).
How to get started
Start by choosing an experienced wealth advisor or insurance provider.
When it comes to insurance, it’s essential to choose an experienced wealth advisor and reputable provider who can provide you with a policy that meets your specific needs.
Don’t be afraid to discuss any potential questions or coverage concerns before making a decision as they can help explain the details of each policy type and provide advice on which option will best suit your individual needs.
By taking the time to make an informed decision you can help ensure that your loved ones are taken care of in the future.
At Gainspoletti Financial Services, we provide comprehensive financial planning and life insurance to bring your vision into sharper focus, so you can enjoy the lifestyle you want and deserve. We believe that our clients deserve exemplary service, and we are committed to delivering.
Contact us today to learn more about our services!
The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing materials are accurate or complete. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Any opinions are those of Gainspoletti Financial Services and not necessarily those of Raymond James. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Raymond James and its advisors do not offer tax or legal advice. You should discuss these matters with the appropriate professional. Life Insurance: These policies have exclusions and/or limitations. The cost and availability of life insurance depend on factors such as age, health and the type and amount of insurance purchased. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mortality and expense charges. In addition if a policy is surrendered prematurely, there may be surrender charges and income tax implications. Guarantees are based on the claims paying ability of the insurance company.