How Life Insurance Can Help You Reach Your Financial Goals – InsuranceNewsNet
iQuanti: Financial wellness means more than just having a healthy savings or checking account. Being financially strong also means planning for worst-case scenarios with a portfolio that includes tools like life insurance. Life insurance provides the stability of a long-term investment and is effectively a “back-up plan” that protects your loved ones and the assets you’ve worked so hard to keep.
If you don’t know how life insurance can fit your personal financial goals, here are some ways life insurance can help.
1. A whole life insurance policy can be borrowed against
When talking about life insurance, it is important to understand that there are many forms. Two of the most common types are term life insurance and whole life insurance. As the name suggests, the term insurance applies for a certain period of time that the policy is active, such as 10 or 15 years. On the other hand, an entire policy is valid for a person’s lifetime, regardless of when death occurs.
In the case of a comprehensive policy, you may be able to borrow against the equity in the plan to help cover expenses while living. This money should only be accessible in an emergency, much like using the equity in your home in a pinch. Remember that your policy will act as collateral for the money you borrow.
2. Life insurance can help finance your children’s education
Life insurance is primarily based on the peace of mind that if something went wrong, such as the death of a breadwinner, the family would still be financially sound. This is especially true when it comes to your children’s education costs. Not only does this include higher education, but it can also be a useful tool for the surviving parent to use for school trips, supplies, childcare, and other child-related expenses.
3. A life insurance policy can protect your investments
For many, achieving financial stability is as much about loved ones as it is about themselves. Strengthen their portfolio with investments and assets that can create wealth and help support their lifestyle and that of others.
For example, investing in real estate, collecting art, or starting a business are all great ways to build wealth, but if your loved ones can’t maintain those investments if you die, they won’t benefit from the benefits. investments for which you have worked so hard. A life insurance policy means direct funds for your beneficiaries to maintain rent, car loan payments, business expenses, and more.
4. Policy endorsements provide additional benefits
Some life insurance companies offer additional options called endorsements to a life insurance policy. There are many types, but living benefits are important to note. Examples of this include a long term care policy endorsement. If you or another insured person needs long-term care in, for example, a nursing home or certain hospital care facilities, the life insurance policy provider will cover the costs associated with the stay. No, these policy endorsements will not be free, but you may be able to add the benefit for a small fee (through bundling) which is paid for with your monthly life insurance premium.
Life insurance plans offer several benefits in the event of death and for living policyholders. When creating the perfect financial plan, it’s important to consider how life insurance fits into it. With the different policy types and adaptability, you can create a plan that supports your lifestyle and that of your loved one, even after you’re gone.
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