Life Insurance is the foundation of financial security for you and your family. It protects your financial resources against the uncertainties of life so you can plan for the future.
Life insurance is part of a broader scope of “risk” management, which could include a accommodating a brief period of risk to that of retirement income planning. We are living longer and need to be prepared with incomes which meet our life span. The biggest “risk” question regarding retirement is “will I run out of money”. That same question actually exists in pre-retirement, “if something happens to me, will my spouse run out of money ( after paying for existing debt, college expenses, mortgage and other loan payoffs, living expenses, etc.). Thus need for life insurance. Term or permanent insurance can be part of this strategy.
While the primary reason for owning life insurance is typically to provide income replacement to your beneficiaries when you die, if you are interested in estate planning, cash accumulation, wealth transfer, and estate tax liquidity, life insurance can also help you achieve these goals.
The main types of life insurance on the market today fall into two categories: Term and Permanent. Simply put, Term Life Insurance provides death benefit protection for a specified period of time (for instance, you might buy a 10-year term policy). Generally speaking, if you’re looking for coverage for a short period of time, Term life makes more sense. If you are interested in using the policy as a form of savings, Permanent Insurance is a better fit. Most life insurance policies will require that you meet certain medical criteria.