How Life Insurance Protect Your Family – Wondering how life insurance can protect your family? This post proffer an answer to the question; how does life insurance protect my family?
Here, you’ll see the basic stuff you need to know about life insurance and how you can access it.
While you may not be able to provide for your family forever, the good news is you can plan to help financially protect them with the purchase of life insurance.
What are the benefits of life insurance and how exactly does life insurance protect your family? Let’s take a look.
Life Insurance Can Financially Protect the Ones You Love
When it comes down to it, the purchase of life insurance isn’t meant for yourself — it’s designed to take care of your loved ones when you’ve passed away.
And if you’re responsible for the financial security of anyone, whether it be a spouse, partner, children, aging parents, disabled loved one, etc., life insurance is an advantageous way to help make sure they are financially taken care of upon your death.
Financial security. Life insurance can help provide peace of mind that your family will have some financial protection upon your passing.
The death benefit can provide assistance with things like mortgage payments, care of disabled loved ones and basic needs like food and child care.
Ultimately it could allow your loved ones to maintain their current standard of living without worrying about the lost income.
Final expenses. The cost of final expenses, things like funeral costs, often amount to thousands of dollars — that’s a hefty out-of-pocket cost that you probably don’t want your family to be troubled with.
Life insurance can help pay for things like the burial and funeral service, among other things.
Medical bills. If you were to pass away from a health-related issue that racked up a substantial amount of medical bills, life insurance could help your loved ones pay them off.
Cash value. A permanent life insurance policy, like American Family’s DreamSecure Whole Life Insurance or MyLife Flexible Life Insurance, has a component where you can build up cash value. This is a way that life insurance can help your family financially while you’re still living.
Once you’ve built up cash value, you can borrow* against it to use it as a loan to go towards things like a downpayment on home, school tuition, investing in a business, etc. — the cash value is available to use as you please.
However, if you don’t pay back the loan before you die, the outstanding loan balance plus any unpaid interest will be deducted from your death benefit.
Choosing a Beneficiary
In order to protect your family with life insurance, you’ll want to make sure you’re choosing the appropriate beneficiary.
Typically, a beneficiary is the spouse or partner of the policy holder, but, especially in the case of the elderly, many choose their children as the beneficiary.
Think about who will be responsible for your debts, state estate taxes, mortgage, nursing home, etc. when choosing a beneficiary.