While we may not like to think about it, planning for the financial protection of loved ones is essential in making sure they are well taken care of in the future – regardless of what that future may hold.
Oftentimes when a breadwinner is lost, their survivors can endure great financial hardship – including a drastic change in lifestyle – if there is not a proper plan in place. The purchase of life insurance can help you keep your promise of protection and financial security to those you love.
We understand that picking the right life insurance coverage can be confusing! This is why our agents will help you select the best life insurance for your situation. After reading through the important information on this page, call our office to schedule a meeting – we are conveniently located in the Brandon/Valrico area of Tampa Bay. During your appointment, you can ask questions about life insurance and about bundling your new policy with other types of insurance, such as home insurance, which can be a great way to save money on your premiums. If you don’t have life insurance protection, you need to become a policyholder as soon as possible.
Top 10 Reasons to Buy Life Insurance
1. Provide for Your Loved Ones
In many instances, the key reason people obtain life insurance is to provide for their family should they no longer be there to contribute. The proceeds from a life insurance policy can be used to pay the living expenses of a surviving spouse and/or children so they don’t have to drastically change their lifestyle, especially during an already difficult time.
2. Pay Off Debt
Life insurance benefits are also oftentimes purchased with the purpose of paying off debt. With these proceeds, loved ones can pay off expenses such as a mortgage or large credit card obligations that may otherwise become a financial hardship.
3. Pay Final Expenses
Today, the average cost of a funeral can be upwards of $10,000. Many families would have a difficult time in quickly coming up with such a large sum in order to pay final expenses that are oftentimes due immediately. By using the proceeds provided by a life insurance policy, your loved ones will have access to the cash they need quickly.
4. Fund a Trust
The purchase of life insurance may also be used in a number of wealth accumulating strategies that involve trusts. The policy proceeds inside of a trust could go towards benefitting loved ones in a number of different ways, including the paying of living expenses for a surviving spouse or providing future funds for a special needs child.
5. Reduce Estate Taxes
Estate taxes can take a substantial portion of one’s overall assets. This is why life insurance is oftentimes purchased to help pay this potentially large sum. There are, however, specific strategies that must be followed, otherwise the amount of the life insurance policy proceeds could be added to the total amount of the estate, causing an even higher amount of taxes due.
6. Protect a Business
Life insurance policies are often purchased by business owners for the purpose of paying the business debts and keeping the company running upon the loss of the owner. Life insurance can also be used towards purchasing a deceased owner’s portion of the company by the remaining owners or partners.
7. Donate to a Charity
Many people have a favorite charity and would like to donate funds to such an organization. Life insurance provides a great vehicle with which to do so. In fact, many donors can actually make a much larger donation using life insurance proceeds than would otherwise be feasible with a direct contribution in life.
8. Use the Living Benefits
Today, many life insurance policies also offer “living benefits” such as allowing the use of the proceeds for long-term care expenses or high medical costs. In doing so, the death benefit amount will be reduced. However, in many cases, it is more beneficial for a policy holder to pay off large debts in this way or to have use of the funds for other needs during life.
9. Accumulate Additional Savings
Most permanent types of life insurance policies offer a cash value component, where the policy holder can build up a substantial amount of savings. These funds can either be borrowed or withdrawn to pay off debts, take a vacation, or for any other reason that the policy holder sees fit.
10. Keep Funds Safe From Creditors
The funds held within the cash value portion of a life insurance policy can also be considered a type of safety net for the policy holder. This is because in the case of bankruptcy, the cash value and the death benefits of a life insurance policy are exempt from creditors.