How Much Must You Spend For Life Insurance?

How Much Must You Spend For Life Insurance?

Life insurance is very important for many reasons. It can help those that are financially dependent on you after you die. It can help pay for your funeral, your bills, and any loose ends you may leave behind. It can help take care of your affairs, and not leave anybody in any financial binds. But how much should you get, and how much will it cost? In this article, you’ll learn the answers to both these questions.

To answer the first question, how much life insurance should you actually get, you’ll need to consider several factors. If you have people that depend on you financially, then you’ll need to take your salary, and multiply that by the number of years they’ll survive after you. Twenty years is a good number. So if you make fifty thousand a year, and you plan on twenty years, that’s one million dollars. Adjusted for inflation, maybe about a million and a half. That should be plenty to take care of your family if you happen to check out unexpectedly in the next couple of years.

Next you’ll need to determine how much it’s going to cost. There are a couple options when it comes to life insurance. There is whole life, which offers protection as well as investments. It builds up cash value over time, which you can have access to if you need it later in life. Term life, on the other hand, only pays a single benefit upon your death. Term life is much cheaper than whole life.

An additional consideration when calculating your cost is your age, and your health. The older you get, the more you are going to have to pay. If you have any health issues, the price may increase as well. Similarly, if you smoke or drink regularly, you’ll likely have to pay more for your insurance. Basically, the younger and healthier you are, the cheaper it’s going to be.

So now you’ve some basic understanding of life insurance. You know about how much you’re going to need, and you have a basic idea of what it’s going to cost. The best thing to do now would be to do some shopping around. There are plenty of places online that will give you free quotes, as well as numerous agents in the yellow pages that would be more than happy to help you. Just keep in mind that the longer you wait, the more expensive it is going to be.

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