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Best Life Insurance Plans: How To Know What’s Right For You
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Finding the best life insurance plans can be a challenge. There are so many different kinds of plans that offers a wide array of features and benefits that it is no wonder many people end up with the wrong insurance, too much or too little.

The key to finding the best life insurance plans is to understand what is the purpose of the life insurance you are buying?

Ask yourself, what do I want this life insurance for? Common reasons for buying life insurance include:

  1. Providing the surviving spouse with enough money to pay off the mortgage and other debts
  2. To provide for the children’s education
  3. Provide the surviving spouse and children an income for several years
  4. To cover funeral expenses and other end-of-life expenses, like medical bills
  5. To have funds available to pay estate taxes
  6. As an investment strategy
  7. As an estate planning strategy

If your goals for your life insurance policy are some combination of the first three reasons, then the best life insurance plans for you would be a term life policy. Term life insurance policies provide coverage for a determined number of years (the term). So a family with young children can reason that in 15 or 20 years all of the kids will have completed their education and have jobs. Since they are no longer financially dependent on their parents, Mom and Dad no longer need a life insurance policy. Term life insurance policies are much cheaper than other forms of life insurance.

The down side to term policies is that eventually the term comes to an end, and the policy is no longer in force. If for some reason you feel the need for additional life insurance at this point, it will be much more expensive than the policy you purchased when you were 15 or 20 years younger. Hopefully, you won’t need nearly as much insurance as you did then.

If you chose #4 and only #4 as your reason for buying life insurance, think twice. Most people state in their wills that the costs of their funeral should be paid for out of their estate. However, these funds cannot be touched until the will clears probate, which is usually some time after the funeral has taken place. There are other ways to provide funds to whoever would take care of your funeral arrangements, but certainly a life insurance policy is one of them. Consult with a financial advisor to determine which option is right for you.

If you are buying because of reason #5, then just make sure that your estate will be in the category of estates that will be assessed.

If your reasons for buying life insurance are among the last two, then some form of whole life insurance is what you are looking for. Understand that whole life is a lot more expensive than term life. Many people are sold whole life insurance on the grounds that it is a good investment. Make sure you have received qualified advice from an estate planner or financial advisor who will not benefit financially if you buy the insurance. There are plenty of other ways to grow your assets, so make sure the product you are buying will help you meet your financial goals.

In short, the best life insurance plans are the ones that make the most economic sense for you. Every person’s situation and needs are different, so finding the best life insurance plans starts with knowing your own goals for protecting your family financially.


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