When you think about life insurance, you might think about your family being taken care of after you are gone. You might think about the monthly transfer of your hard earned dollars into the hands of the insurance company. You might also think about several of the “facts” about life insurance that you’ve heard your friends, family, neighbors or coworkers share. However, your cousin Joe or your best friend Jane wouldn’t be aware that the information they passed on to you is partially filled with myths. This article seeks to dispel 5 of the most popular myths about life insurance.
1. If you have poor health, no life insurance company will give you a decent policy. The truth is, while your coverage may be more costly than a healthier counterpart’s coverage, coverage is still available.
2. If you are single and don’t have any children, you don’t need life insurance. While a spouse and kids are certainly important reasons to consider securing a good life insurance policy, they aren’t the only reasons one needs life insurance. Your life insurance policy can take care of any debts you may have occurred and cover the expenses of your funeral arrangements, leaving less stress on whoever will be in charge of your estate after your death.
3. If you aren’t the primary income source in your family, you don’t need life insurance. The death of the family’s main income provider can certainly be financially devastating for a household, however, so can the death of a spouse who did not work outside of the home. The services provided by that spouse including childcare, cooking, and cleaning all have monetary cost associated with them, cost that could add up if that spouse were no longer around.
4. Your family won’t be able to benefit from your life insurance until you’ve passed on. Term life insurance may not be able to offer your family monetary benefits until after your death, but a permanent life insurance policy can. Holders of a permanent life insurance policy have the ability to borrow against their policy to fund things like retirement.
5. Investing your money would be a better plan than securing a life insurance policy. Smart investments can make you a good chunk of change. The thing with investments though is that at any point in time, you can lose your money. It’s a much safer plan to put money into a life insurance policy so that you know the money your family needs after you are gone, will be there regardless of the financial market.
While life insurance certainly has its benefits, it may not be the best option for everyone. Every individual and family needs to consider how much a life insurance policy can benefit them, taking into consideration their current financial situation, what they expect their future financial situation to look like, and a host of other factors. The most important thing to do when evaluating whether or not a life insurance policy is the best thing for you is to make sure that you have accurate information. Talking to your insurance agent and other knowledgeable professionals can certainly help clear up some confusion.