Enough Life Insurance to Feel Financially Secure

Without enough life insurance, an early death can have a long-term, negative impact on the finances of the surviving spouse.
Having an amount of life-insurance that is three to four times household income can help the surviving spouse be more financially secure, according to a new study from MetLife. Less life insurance than that and the surviving spouse can feel not only financially insecure but be forced to make numerous life changes immediately.
While the study found that 8 out of 10 survivors had to make financial adjustments, life insurance may help limit the number of changes that need to happen right away.
For example, of the individuals who participated in the life insurance study:
• 42% who received no life insurance benefits said they had to borrow money from friends and family compared to 25% of those receiving benefits.
• 36% who received no life insurance benefits relocated residences compared to 23% of survivors receiving benefits.
Term life insurance can be an affordable option for young families. And it is important that both men and women have life insurance. The survey found husbands who lost a spouse received significantly less in benefits because the wife had a small life insurance policy. Life insurance is not just about being able to replace loss of an income. It is also about having to pay for services that the individual may have handled, such as child care or elder care.

That’s why it’s important to regularly review your life insurance policy, both husband and wife, and make sure that the amount of the benefits is appropriate to at least continue your current lifestyle.

Term-Life Insurance Might Be the Best Deal

It will soon be open enrollment time at many workplaces. As you sort through your health insurance options, you might also find an opportunity to purchase term life insurance.

Don’t check that box yet to purchase.

If this is a voluntary benefit – which means that you pay the full cost – it is smart to shop for term life insurance on your own first. If you are young and healthy, you will likely find lower cost term life insurance if you buy on your own rather than through the workplace.

That’s because group insurance usually has very little underwriting – which means if you have existing health conditions, you still may be able to get insurance. That’s good news – and probably a good purchase – if you have health conditions. But it costs more. So if you are generally healthy, you might find that buying term life insurance on your own can cost you a lot less. That’s because you are a better insurance risk than those with health conditions. Plus, you’ll have the policy no matter where you work, as long as you keep paying the premium.

Shopping for term life insurance online is easy. Go to sites like www.iquote.com and simply fill out the information. Match it as close as you can to your offer from work so you can get a good comparison. You’ll receive term life insurance quotes from a number of insurance companies. That’s another reason to shop on your own – term life rates can vary dramatically from company to company. And you can always talk with an agent to make sure that you are selecting a plan that best fits your needs.

So before you check that life insurance box at work, find out if you can save or buy more coverage on your own for the same price by purchasing an individual term life insurance policy.