Why Life Insurance Could Be the Right Choice for You — Now
By Janet Todd, Ph.D.
Securing the future needs of your family is crucial, and that’s what life insurance can do. But creating a plan can seem daunting.
Thankfully, there are ways to provide monetary resources for your loved ones if you are no longer able to do so. While reviewing your health needs and benefit options during this open enrollment period, it may be a good time to consider if life insurance is right for you at this time.
Think of life insurance as a gift to your loved ones.
Life insurance can ease expenses for your surviving family members in a variety of ways:
- The cost of your funeral. The most immediate expense life insurance can cover is the cost of your burial. The average cost of a traditional funeral in 2017 is $8,000 - $10,000.*
- Living expenses for your dependents. Life insurance is meant to replace the income or financial support that you provide. Depending on the value of the policy, life insurance can allow your spouse or partner to stay in their current home, pay off debt, fund a child’s education, donate to a favorite charity, and continue to enjoy the life they have now. If you have a special needs child, a life insurance policy can be especially important as the proceeds from the policy can help with the ongoing cost of healthcare and quality of life needs.
Life insurance is not just for the family breadwinner.
Everyone can benefit when others are insured! Here’s why:
- Stay-at-home spouse or partner. A partner who stays at home may not have earned income, but the financial value of what he or she contributed to the home may have to be replaced nonetheless. Replacement income could be needed for childcare or other such at-home services.
- Singles. While there may not be heirs who rely on your income, life insurance can help pay for final expenses, such as burial costs or be used for charitable giving.
How much is enough?
Everyone’s needs are different. To figure out how much coverage may be right for you, start by taking a look at your current financial situation:
- Take a look at your debt payments, such as a mortgage, car loans, credit cards, and student loans. Don’t forget to include your everyday expenses. Consider everything your salary pays for, and for how many years you would want life insurance to enable a beneficiary to be able to cover these expenses, such that they can continue to enjoy the life that they have now.
- Review your assets and expected benefits from 403(b)/401(k)s, Individual IRAs, other such financial investments, pension survivor benefits, and existing life insurance benefits.
Don’t worry — this doesn’t have to be complicated.
You can determine your life insurance needs by using the Life Insurance Calculator on the CPG website. Once you have a good sense of how much coverage you’ll want, you can begin to determine which type of policy would best meet your needs. Some policies allow you to cover temporary needs and are in place for a set time frame, while other policies can be in place for your lifetime. You can find policies with flexible premiums, investment opportunities, cash value accumulation, and/or a combination of the above.
You can find information about different life insurance products and providers on the National Association of Insurance Commissioners website. Before you buy, you may want to check with your state insurance commissioner that the agent and company are in good standing. Also, check with your employer to see if they provide you with any coverage.
You can also contact the Church Pension Group’s licensed life and retirement specialists at (888) 735-7114, Monday — Friday, 8:30AM — 8:00PM ET (excluding holidays), to schedule a complimentary discussion. They can help you think through your life insurance needs.
It’s never too early to plan for the future security of you and your loved ones. Consider taking time now to explore life insurance options that are right for you.
Janet Todd, Ph.D., serves as manager of curriculum development for the Church Pension Group (CPG), responsible for curricula used in CPG’s education programs.
*How Much Does an Average Funeral Cost?
Life insurance is offered by or through Church Life Insurance Corporation; 19 East 34th Street, New York, NY 10016 (“Church Life”). Like most insurance policies, Church Life's policies contain exclusions, limitations, reductions of benefits and terms for keeping them in force. For complete details of coverage, including exclusions, limitations and restrictions, please consult the actual policy or certificate. Products and features may not be available in all states.
In any conflict between the descriptions of products contained herein and the terms of the life insurance policies or annuity contracts, the terms of the life insurance policies or annuity contracts shall govern.