Maximize your HSA e-Newsletter
Vol. 16, Issue 3
Yes, Most People Actually Do Need Life Insurance
Some truths are hard to swallow, but we think this is one truth that goes down easy and leaves an aftertaste of confidence and security. While planning for your own untimely demise might not sound like the way you would like to spend your afternoon, it is actually a lot less of ‘a thing’ than you might imagine.
The real benefit, however, is the lasting knowledge that your loved ones will be taken care of, and I can assure you, there is no cash value to this kind of confidence.
Hard Truth: Dying is More Expensive than you Imagine
Because the large majority of people in this country never spend more than a few moments thinking about what is going to happen when they pass away, most of them end up leaving large bills and financial liabilities when they die. They are survived by loved ones who are forced to pick up the tab, and for a family who has just lost their primary income source, the results can be devastating.
When you combine the costs of a funeral and the associated medical costs of passing away, your estate is going to have to fork out an average of about $10,000, right off the bat. This is nothing compared to the cost of losing an income source and not being able to make up for it. In these situations, families are forced to lower their standard of living, move into smaller houses or apartments, and even abandon their educational aspirations just to get the bills paid.
OR, you can sleep sound at night knowing that every one of them is protected against such scenarios. We believe that once you have a look at the quotes, you will understand how attainable a solid life insurance plan actually is.
Term Life Insurance vs. Whole Life Insurance
When you decide to start shopping around for life insurance, you are going to hear reference to two specific types of insurance: Term and Whole. The difference is important to know but easy to understand.
Term Life Insurance can be purchased for a specific number of years, that number being the ‘term’ of the policy. In other words, if you have a 20 year policy and you pass away before those 20 years are up, your estate, dependents, or beneficiaries will receive the insurance payout. Deciding upon the term you need means estimating how long it will take before your income is no longer needed to support your family.
Whole Life Insurance, also referred to as Permanent Life Insurance, actually develop a cash value as they (and you) age, the idea being that the final payout is made regardless of when you pass away. Because whole life policies are guaranteed to pay out, they can seem like a better option. However, high commissions and fees in addition to low return rates tend to outweigh the benefits.
Life Insurance Isn’t Out of Reach for Single Parents
Contrary to popular belief, affordable life insurance is not something that is reserved for big families with multiple incomes. This misconception is perhaps the biggest reason why so many single parent families in the United States have neglected to even look at life insurance policies.
The fact of the matter is that if there is a child in your life that depends on your income, term life insurance is highly recommended. If something were to ever happen to you, the costs of your funeral alone could be enough to exhaust your estate and leave your child in the dust. Term life insurance can not only provide the financial security your family needs to cover your passing, but also funds that can be used to pay for the child’s ongoing needs, like healthcare and college.
Check the Rates & Sign Up for Coverage
If you are interested in checking out life insurance rates based on your personal financial situation, you can do so with our Instant Rate Checker. It only takes about two minutes, and you will walk away with a better idea of how affordable some of these plans can be.
Once you have found a plan you are looking for, you can apply online or simply give us a call. We’ll make sure that you’re getting the best rates available, as well as walk you through every step of the enrollment process.
For a more complete explanation of the different options that are available to you, we recommend that you download our free, short e-book, The HSA for America Consumer’s Guide to Life Insurance (PDF).
President – HSA for America
The HSA for America Maximize Your HSA Newsletter is published monthly and emailed to subscribers at no charge. Subscribe now to stay on top of the critical information you need to know about health insurance, healthshare plans and managing your finances to achieve financial security.
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