Life Insurance: Do You Need It?
At some point in your life, you'll probably be faced with the question of whether you need life insurance. Life insurance is a way to protect your loved ones financially after you die and your income stops. The answer to whether you need life insurance depends on your personal and financial circumstances.
Should you buy life insurance?
You should probably consider buying life insurance if any one of the following is true:
- You are married and your spouse depends on your income.
- You have children.
- You have an aging parent or disabled relative who depends on you for support.
- Your retirement savings and pension won't be enough for your spouse to live on.
- You have a large estate and expect to owe estate taxes.
- You own a business, especially if you have a partner.
- You have a substantial joint financial obligation, such as a personal loan for which another person would be legally responsible after your death.
In all of these cases, the proceeds from a life insurance policy can help your loved ones continue to manage financially during the difficult weeks, months and years after your death. The proceeds can also be used to meet funeral and other final expenses, which can run into thousands of dollars.
If you're still unsure about whether you should buy life insurance, a good question to ask yourself is: If I died today with no life insurance, would my family need to make substantial financial sacrifices and give up the lifestyle to which they've become accustomed in order to meet their financial obligations (e.g., car payments, mortgage, college tuition)?
If you need life insurance, don't delay.
Once you decide you need life insurance, don't put off buying it. Although no one wants to think about and plan for his or her own death, you don't want to make the mistake of waiting until it's too late.
Periodically review your coverage.
Once you purchase a life insurance policy, make sure to periodically review your coverage—especially when you have a significant life event (e.g., birth of a child, death of a family member)—and make sure that it adequately meets your insurance needs. The most common mistake that people make is to be underinsured.
RBFCU Investments Group LLC is a wholly-owned subsidiary of RBFCU Services LLC. RBFCU Services LLC is affiliated with Randolph-Brooks Federal Credit Union (RBFCU). Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA / SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. FR-2644615.1-0719-0821