Protecting your family against financial catastrophe: it’s one of the most important things you can do. That’s why Protecting Yourself is a foundational component of Financially Fit Bootcamp. And having the right amount and the right kind of life insurance is place is key to safeguarding your family.
Why life insurance? Simply because you love your family. In the event of your death, you want them to be able to have the lifestyle you had planned to have before you died.
And you don’t want your loved ones to worry about money. Or to be forced in an emotional time to take on another job, downsize from your family home or be subjected to calls from creditors.
So, if you’ve been putting off this important purchase or don’t know where to start, we’ve got you covered. Here are the answers to the three biggest questions we get when it comes to choosing a life insurance policy.
Who Needs Life Insurance?
If you need it, not having a life insurance policy in place can be a colossal gamble. At the same time, some people who purchase this coverage truly don’t need it.
The basic rule of thumb is this: If someone depends upon your income or the valuable services you provide, you need life insurance. So, for example, you should have a life insurance policy in place if . . .
- You bring home a salary that’s necessary for paying your family’s expenses.
- You receive benefits (a pension, disability payments, etc.) that support your family and that will decrease or disappear in the event of your death.
- You’re a stay-at-home parent who performs essential tasks that have a monetary value. These activities may include child care, household maintenance, financial planning and more.
However, if no one depends on you financially, you probably don’t need a life insurance policy. So then, you can probably skip out on this coverage if . . .
- You’re a child.
- You’re single with no dependents.
- The necessary income you provide won’t stop if you pass away. (For instance, your business profits, investment dividends, pension benefits or Social Security checks will be paid in full to your spouse or dependents.)
How Much Life Insurance Should I Get?
Dr. Tony is the co-founder of MindShift.money and the best-selling author of three books on personal and business finances. Having achieved Financial Freedom at 27, Dr. Tony believes that through Financially Fit Bootcamp and Cash Flow Cure everyone can get there. He has made it his life’s mission to help others live a life where their money works for them—not the other way around.