Life insurance isn’t exactly a straightforward topic: it can be difficult to discuss, and it can be even harder to know what you need. However, there are some basic mistakes you can avoid if you just have a bit of a primer on what NOT to do when it comes to life insurance.
If you don’t have life insurance, you could leave your loved ones with an undue burden in the event of your death. Life insurance isn’t terribly expensive, especially for healthy adults, and could be a serious life-saver for your family to help cover things like your funeral expenses and outstanding debts.
It can be easy to avoid thinking about life insurance. After all, it won’t matter to you, as you’ll be gone. However, this is a very short-sighted viewpoint, and could leave your family without the finances needed to help settle your affairs.
It’s important that you have enough life insurance to cover your debts and your outstanding financial affairs. For instance, if you owe money on your car, mortgage or various loans, you want to make sure you’ve got enough life insurance to keep your family from taking on the undue burden of your debt.
Some people think any life insurance policy is fine and just leave it at that. However, you want to make sure you’re not simply wasting your money on a policy that doesn’t fully cover you.
Conversely, you want to make sure you’re not overspending every month on your life insurance policy. If you don’t have a large amount of debt, or if your kids are grown and self-sufficient, then you don’t need to spend larger quantities of money than are necessary on your insurance.
For instance, if you own your home and don’t have a mortgage payment, own your car without a payment, and don’t have any outstanding debts, then you don’t need a lot of life insurance. Enough to help handle your funeral expenses and any unforeseen end-of-life debts you may have incurred should be plenty to help your loved ones.