Why get life insurance is a question many people ask. After all, most employers provide a policy as one of the employee benefits. So what invest in more?

There are many reasons why someone should get life insurance, but they are not the same for everyone. To decide if you need to more life insurance that what you get at work, think about who is financially dependent on you. If you don’t have anyone in that category, then you are most likely fine with the insurance you have.

But what if you have a wife and kids? Or elderly parents dependent on you for care? Now we have a different situation.

Debt Relief

Think through how you would want to provide for the people who are financially dependent on you. The first thing most people think of is that they would want their debts paid. Funeral expenses and medical expenses from the end of their life are two important categories. Have a mortgage on your house? Would your spouse’s income be enough to make those payments? Maybe you’d want enough life insurance to cover the mortgage and any other debts that you have.

Children’s Education

Another goal people often have in mind when they ask themselves why get life insurance is to pay for their children’s education. Obviously if one spouse dies, if will be more difficult to save up for college tuitions and other expenses. A Life insurance policy can give you that assurance that if anything happens to you or your spouse, there will be money to send the kids to college.

Replace Lost Income

Especially if one spouse isn’t working, the death of the other spouse can cripple a family financially. Life insurance can help alleviate this situation. Generally people figure that they need enough life insurance to carry the family for 3 to 5 years. The assumption is that by that time the surviving spouse goes back to work.

Additional Income for Retirement

Once the children are grown, educated and financially independent, the response to the question why get life insurance change. At this stage in life, people’s thoughts turn more toward retirement. Any planning would be thrown out of whack if one spouse suddenly died. So that’s where life insurance comes in. A policy could be taken out to make up that lost income and savings.

Domestic Help

When most people consider why get life insurance, they typically think about the working spouse. But what if the stay-at-home spouse dies? Domestic help and child care can be very costly. To protect against that situation, many people take out life insurance on the partner who provides most of these services.

Other Reasons

Still other people consider life insurance for more complex estate planning or tax purposed. Generally these are people with large estates who want to provide their heirs with the money necessary to pay for estate taxes, or to get some tax advantages. Still others use life insurance as an investment, hoping to grow their money. None of these strategies should be adopted without consulting a tax or estate planner who has no vested interest in you buying any form of life insurance. While these can be smart strategies in the right situation, you want to make sure. Don’t buy any life insurance unless it is in your best economic interest.

So consider your own situation to answer for yourself why get life insurance, and know why you are buying before spending any money.