According to Randon James Morris, for most people, it is easy to say “I’ll handle that later.” Especially when it comes to life insurance. We assume that we have time to sort out the details of adequate coverage down the road. However, in the end, either we forget it mentally or it’s too late to consider.
Needless to say, life insurance can play a key role in protecting your loved ones financially when you pass away unexpectedly. Often the role of protection plays in your financial plan depends on your life stage.
Here are several examples of when you may want to evaluate your life insurance options:
Young adults starting their careers
When an individual settles into his first or second job and takes on responsibility for all financial matters, he needs to balance a myriad of priorities. These may include managing the mortgage of a newly-purchased home or paying off significant student loan debt.
In the happening of your death, it may become difficult for your family to cover your financial obligations out-of-pocket. However, a life insurance policy may help provide the cash flow for your family or other trusted beneficiary to handle your affairs without it becoming a potential burden.
Newly married couples
When you build a life together with your spouse, it’s obvious that your individual financial responsibilities will become intermingled, even if you choose to keep separate bank accounts. If you die prematurely, your spouse could be extremely affected by the loss of your expenses. In such a situation, life insurance can protect the financial contributions of each spouse. It will also help the surviving spouse to carry on without major changes in lifestyle.
Parents of minors or young adults
For many individuals, the need for life insurance becomes a topmost priority following the birth or adoption of a child. If you have or are considering starting a family, this is the right time to evaluate your insurance policies. And make sure that you have enough coverage to meet your family’s everyday expenses, in addition to future financial goals.
Future goals may include everyday living expenses over a period of years, costs for children’s education and retirement savings for the retired spouse. In case you or your spouse is a stay-at-home parent, it’s a nessary to have insurance that covers the potentially significant costs of childcare and increased household expenses your family may incur in his absence.
Older adults nearing or in retirement
As you achieved enough wealth or become an empty-nester, necessity for life insurance may decline. However, still, it is better to maintain enough coverage to protect your retirement savings. Once in retirement, the need for a death benefit, which provides a lump sum or annuity payments to the surviving spouse, may become less substantial.
Few types of life insurance policies may offer the flexibility to borrow against accumulated cash values in order to provide cash flow in retirement. Calculate your coverage against what you anticipate spending in retirement to analyze if these or other options could help your situation.
In the end, your life stage or financial situation doesn’t matter, what is important is to have insurance in place to secure your loved ones financially. Therefore, Randon James Morris advises every individual to regularly review your coverage and ensure it covers the changing needs of your family.