Online Life Insurance Protection – How Much Do I Need?


 Online Life Insurance Protection – How Much Do I Need?

This article will help you decide how much life insurance you need to buy.

Life insurance can help provide for your family's needs when the unexpected occurs. When purchasing a policy, it’s important to consider how long your beneficiary may be dependent on the proceeds from the policy. The more time they have, the higher coverage required which is why we recommend 20-30 years of coverage if you're married with kids and 10-20 years of coverage if you don't have children or other dependents who will rely on that income.

What type of life insurance should I buy?
Term or whole life?
Term insurance provides a death benefit that will last for a specific period. The coverage can be used to pay off debts, mortgage, pay for college or save on taxes. The premiums are more affordable than whole life policies. However, there's no cash value and it will expire at the end of the term.
How long do I need, really?  The longer you need coverage for -the higher coverage needed. If you're a healthy person and you don't have dependents, then a term policy is the best way to go.
If you have dependents who rely on your income today, then consider Whole Life Insurance. Whole Life Protection offers a death benefit that can be used for many years and has cash value that grows over time with no additional premium charges. 
Whole life policies come in two varieties: Level coverage and decreasing term coverage. Level Term or Universal Life policies are the most common types of whole life policies, they provide financial security for life without an age limit and can be converted into a guaranteed lifetime income for your spouse or retirement income for you. A decreasing term policy will provide a decreasing death benefit and more affordable insurance costs than whole life. The death benefit of a decreasing term policy can be reduced to zero (most policies reduce the death benefit at age 80).
Life insurance rates are based on your age, health and if you have any existing medical conditions. As you get older, it gets more expensive. This is why it's important to maximize your coverage in your 20s and 30s when premiums are affordable and build cash value in the policy to help reduce future premiums.
What is the minimum coverage I need?
For people who don't have dependents or who are healthy, $1 million in coverage is often enough. If you're married with dependents then $500,000 may be more than enough. For single people there's really no minimum at all. It depends on your current living situation and what needs you have in the future. Each person must weigh the risks that they face today with the future needs and determine what's most important to them.
The better off you are, the more insurance you need to buy. The less fortunate will probably need a little bit more, but very few people need life insurance policies that provide $5 million or more of coverage.


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