Life insurance is designed to remove some of the financial burdens that come with the loss of a spouse or other loved one. While this might be scary to think about, it is best to obtain a life insurance policy early on to reduce the stress that might arise in the future. There are several different types of life insurance policies, so it’s important to do thorough research before deciding which type is the best fit for you and your family. Here are 5 reasons that you should consider purchasing a life insurance policy:
1- Life Insurance Can Fund Memorial Services
A loss in the family can be an emotional time. Funerals are also relatively expensive, which can only add more stress to an already stressful situation. However, life insurance can ease some of the many expenses associated with a funeral due to the death benefit provided. The beneficiary can use this to pay the funeral director, or they can pay with their own money and request full financial reimbursement from the insurance company.
2- Life Insurance Can Reduce the Financial Burden of Income Loss
Losing a source of income can become more and more difficult as the bills start to pile up. However, the money that the beneficiary receives from the death benefit in their life insurance can be used to pay off utility bills and can be used to pay for other things such as groceries and day-to-day necessities. It can also offer the family a sense of comfort, as they will not have to worry as much about money going forward.
3- Life Insurance Can Be Used to Pay for College
College can end up being super expensive, sometimes even after the child receives scholarships. However, a lot of life insurance policies have a feature that holds savings, and all of the money placed here can be used to fund a college education. Using life insurance to pay for college has many benefits. Any money within the savings aspect of a life insurance policy will not be counted in any financial aid calculations, which means that the child will have a lower expected family contribution and will receive more financial aid from respective government agencies. Additionally, the money will not be lost if the child chooses an alternate route, such as joining the military or attending a trade school, as opposed to going to college.
4-Life Insurance Can Enable One to Leave an Inheritance
After the loss of a loved one, things such as money and property can be passed down to whoever is named as the beneficiary with the purchase of life insurance. The money can be used for several things in the future, such as paying off debts, paying off mortgages and building an emergency fund. An emergency fund is a sum of money that is set away and used when distressing expenses come up without warning.
5- Life Insurance Benefits are Not Taxed
Whenever the beneficiary receives money, they are entitled to all of it, because the money that comes as a result of a life insurance policy never undergoes federal taxation. Life insurance benefits are created with you and your loved ones in mind.
If you are looking for life insurance, look no further than our knowledgeable, reliable financial planners here at Care Financial.