Life insurance is one of the most important purchases you will make. Find out how much you need, and find out how your family will benefit. It's the answer to a very difficult question- how will my family manage financially when I die?
If a tragedy happens Life insurance tax-free proceeds can be used to :
The basic feature of a Life Insurance policy is the death benefit: the lump-sum your beneficiaries would receive if you were to die. But not the only feature, some policies offer riders that can be an important addition in your financial strategy, such as the ability to accumulate cash value that grows over time.
Term life insurance provides protection for a specific period of time ("term") and is designed for temporary circumstances. It makes the most sense when your need for coverage will disappear at some point, such as when your children graduate from college or when a mortgage (debt) is paid off.
The most common term policies provide coverage for 10, 20 or 30 years.
Typically, term insurance offers the greatest amount of coverage for the lowest initial premium and is a good choice for anyone on a tight budget
Permanent insurance offers lifelong protection, and you can accumulate cash value on a tax-deferred basis. This cash account can be used for a variety of purposes, from helping you out of a tight financial spot, to providing funds to take advantage of an opportunity, to supplementing your retirement income. Initial premiums are considerably higher than what you would pay for a term policy with the same face amount.
Permanent insurance falls into four main categories:
Access to Cash
A policy's cash value can be surrendered, in total or in part, for cash that can be put toward important uses like a child's education, a business opportunity or supplemental retirement income. You can borrow from the insurance company at relatively low interest rates and use the cash value as collateral. The loan is not dependent on credit checks or other restrictions. Be aware that borrowing or withdrawing funds from your policy will reduce its cash value and death benefit if not repaid.
If you need to stop paying premiums, the cash value can keep your insurance protection in force for a period of time.
Cash value accumulates on a tax- deferred basis. Death benefits paid to the beneficiary generally are not subject to federal income tax.
As long as you don't allow your policy to lapse, the coverage is for life and you won't need to worry about being unable to afford coverage if your health deteriorates.
With many types of Permanent insurance, premiums will remain constant or stable over your lifetime. With Term insurance, premiums increase as you age.
If you'd like to know if term, permanent or a combination of both types of life insurance would work for you, contact me today or fill out the request form.