Understanding Term Life Insurance
What term life insurance is and how it applies to you.
So you’ve heard of term life insurance but you’re not sure what it is or how it applies to you? I’m Max Anderson and I’m here to tell you that term life insurance isn’t just something you should have on the backburner of your priorities list. It’s something that you should think about right now.
Who Needs Term Life Insurance?
Term life insurance is something that everyone who has dependents should have. If there are people counting on you financially, term life insurance isn’t a matter of should have, it’s a matter of must have.
What Does Term Life Insurance Do?
Let’s say you were to pass away unexpectedly. If you’re the breadwinner in your family, this could cause some serious financial stress for those that you leave behind. Term life insurance can help alleviate this financial burden by providing your family with a one-time, lump-sum payment equal to the amount of your term life insurance policy.
Term Life Insurance vs. Whole Life Insurance
In addition to term life insurance, there is another type of life insurance policy called a whole life policy. This type of policy builds a cash value but it is also much more expensive than term life insurance. If you’re looking for a good insurance policy that will provide your family with a death benefit should you pass away and you want to do it for as inexpensive as possible, a term life insurance policy is your best bet.
How Long Will the Policy Last?
Term life insurance policies will usually stay in effect until you reach age 75 -- that is assuming that you pay the monthly premiums each month. The theory behind this is that by the time you reach age 75, your dependents should be financially stable enough to meet their own needs and life insurance is no longer needed.
While a whole life policy will let you renew the policy throughout your entire life, a term life policy is much more affordable than a whole life policy and can provide for your basic needs.
While term life insurance may not build cash value like a whole life policy, the benefits of this type of policy are not to be overlooked.