When it comes to protecting our family, we tend to concentrate on all the standard guidelines, such as providing them with a roof over their heads, food on the table and decent clothes to wear.
What some of us seem to forget is that we need to provide for them after we are gone. One of the reasons for this is because we never think of ourselves as vulnerable.
Newsflash: we are.
Purchasing life insurance is super important, but often people miss the mark in how much life insurance they need to purchase.
I’ve encountered couples that purchase $100,000 life insurance policy and think that’s going to cover their spouse and their kids. After funeral expenses, paying off some debts, and any other unexpected costs; there will be nothing left.
Some may immediately dismiss that they need a million dollar life insurance policy. “That’s just way too much!”, many would argue.
I’m here to say that a million dollar life insurance policy could very well be not enough!
Why a million dollar life insurance policy
Will discuss many of the reason below in why you might need a million dollar term policy. One of the biggest misconceived notions in such a large policy is that they cost is way too much. For some reason I truly believe that people think that a million dollar insurance policy costs 1 million dollars. It doesn’t! Here’s a breakdown of the costs of a $1 million life policy:
$1 Million Life Insurance Rates for Men
|Sex||Age||$1,000,000 20 year Term|
$1 Million Life Insurance Rates for Women
|Sex||Age||$1,000,000 20 year Term|
Still not convinced that you need a million dollar life insurance policy? Here’s some factors to consider:
Buying a new home
The cost of living is only getting harder to meet, which is why picking the right dollar amount for a term life insurance policy is so important. The moment we sign on the dotted line for a new home, we should be thinking of the possibility that, in the event something happens, it will be paid for.
You don’t want to think about it, but would your family’s finances suffer if something happened to you?. Would they be able to pay off your mortgage? Probably not. Having enough life insurance coverage can give them the resources they need to do that.
The important occasions
If we take the time to think ahead to how our family will support themselves after our demise, our minds could drift to graduations, weddings, grandchildren and so on. If we end up passing on before all of these things take place we will certainly want to do our part, regardless of whether we are here to witness them, which is why we will need a decent life insurance policy.
Working for yourself
Many of the jobs being offered today will provide term life insurance to their employees, unfortunately the benefits are hardly enough to cover more than just the basics. There are also a lot of people that had coverage through an employer, but have since left that job. While they have a new job, they haven’t thought about life insurance coverage. On the other hand if you venture into your own business, it is a good idea to take out a decent size term life insurance policy so that all would not be lost if you pass away. Your life insurance policy can not only help your family pay off any final expenses but also cushion the financial blow your business would experience if you passed away.
The one advantage to having life insurance coverage through an employer, is that you might be able to purchase a smaller insurance policy to supplement the coverage that you get through your employer. This is a real money-saver instead of having to pay for the whole coverage yourself.
Filling the gaps
There is nothing worse than reaching your retirement years and realizing that you don’t have enough funds to make it, with or without social security benefits. Life insurance is a good way to make certain that if your spouse ends up on their own and they lose the benefit of your social security income, they will not be left out in the cold.
Adjusting for change
Finally, there are several reasons to make adjustments to a term life insurance policy, not the least of which is a lifestyle change. We may start out with enough of a policy to cover a wife and one child, only to realize that our family has expanded, or we purchased a bigger home, that is when we will need to increase our payout benefits.
The more family members that you have that are dependent on your income, the more financial loss they would suffer financially. On the other side of that coin, if you have children that get jobs of their own, and don’t rely on your insurance, you can consider getting a smaller policy.
Take the time to sit down and calculate all of your life insurance needs. There are dozens of different aspects that you need to consider. You also need to ensure that you have ENOUGH coverage for your loved ones.
Getting the Cheapest Insurance Possible
When people start looking for a life insurance policy, they think it costs a fortune. In most cases, a policy is much cheaper. We’re going to give you some quick tips on saving money.
The first, and most important thing you can do is to quit smoking. Using tobacco is a sure way to have your monthly premiums go through the roof. Smokers and tobacco users pay twice as much for insurance.
There are a lot of applicants that ask us about e-cigarettes or smoking cigars and the impact that those will have on their premiums, and the answer is, it depends. Some companies will allow you to get better rates for an occasional cigar or e-cigarettes, while other companies are going to lump you in with smokers and charge you the same rates. It’s vital that you find the company that is going to get you the best rates.
Another thing you should do to get the best rates is to get in shape. The insurance company is going to want to get a picture of your overall health before they accept you for coverage. This means that the better your health is, the more money you’ll save on your insurance plan.
They are going to have a paramedic come to your home to complete a medical exam. Don’t worry, it’s not as bad as you might be thinking. They will take your basic vitals like your blood pressure, heart rate, weight, and several other simple health signs. In addition, they will also require you to give a blood sample and a urine sample to see if you have any pre-existing health conditions that you did not tell them (or maybe you didn’t know about). If you want to lower your insurance premiums, spend some time focusing on your health before you apply for coverage.
Make some healthy food choices and start going to the gym more often. Both of these can have a drastic impact on your overall health by lowering your cholesterol, blood pressure, and much more. Not only will you feel better, but also you’ll have more money in your wallet. It’s a win-win scenario.
If you have any pre-existing conditions, you may think that you won’t be able to be accepted for a $1 million policy, but that isn’t true. In just about every case, you can find an insurance company that will give you the insurance that you and your family deserve. If you have any severe complications, it’s important that you follow your doctor’s orders to manage those conditions and keep the effects as minimal as possible.
Using an Independent Agent
There are several advantages to working with an independent agent versus going through it alone.
The first is that an independent agent is going to save you time. If you wanted to get quotes from dozens of companies by working with a traditional agent, you would spend hours on the phone. Instead, call us, and it’s just like you called 50 companies at once.
Aside from saving you time, independent agents also save you money. Every insurance company has a different rating system for calculating their insurance premiums, which is why it’s important to work with an agent who is experienced working with a variety of insurance companies. If you have any pre-existing conditions like diabetes or any heart problems, we know which companies have experience working with applicants like you and will give you the lowest rates.
You have to consider how much life insurance coverage you need. It’s important that you get the perfect amount of insurance coverage for your loved ones. If you have too little, your family won’t have the resources to pay any debts or final expenses that you leave behind. If you purchase too much insurance coverage, you’ll be spending way more every month in premiums than you should be. It’s difficult to find the delicate policy between too much and too little. You’ll have to look at all your expenses, debt, income, and much more. If you’re still not sure if a million dollar life insurance policy is right for you, check out our term life insurance needs calculator.
If you have any questions about a $1 million policy or the different types of life insurance coverage, contact us. Don’t wait any longer to get your life insurance policy in place.