This post is in support of the Why Life Insurance Is Important to You movement by Jeff Rose
Life Insurance : A Tool in your Financial Tool Box.
For several years I was a Reserve Deputy Sherriff in Northern Nevada. In my training we always referred to the weapons on our duty belts, as Tools.
When confronted with a situation, I had to choose the correct tool in order to perform my sworn duty to preserve life and property. My tools ranged from Non-Lethal to Lethal. This term has always stuck with me and to this day I always think of and refer to Term Life Insurance as a Financial Tool.
The importance of the Life Insurance Tool.
During someone’s maximum money making years they will probably carry the most debt – Home Mortgage, School Loans, Car Loans etc. If they have children money for college is an important consideration. The use of the Life Insurance Tool to cover these expenses, in the event of an unexpected death, is probably the main reason you want a Life Insurance Policy.
The above requires calculating a need analysis. This can be done with a competent Life Insurance agent. There are also several great calculators (more tools!) that you can use. Here is one that I like:
One Example, The Family: Who should get the Life Insurance Tool?
If you are a family and have children BOTH of you need to carry life insurance!
Let me explain. Say one spouse works and brings in the main household income. Insuring this person is obvious. But the person who stays home and manages the house and children also has value and saves income (Cash Flow). If the one caring for the home and kids, unexpectedly dies, the surviving spouse will need the life insurance funds to take care of the household expenses while he or she continues working. I am always surprised when only the income producing spouse wants Life Insurance.
Many more uses of the Life Insurance Tool
People have different needs and different situations. These are things that need to be discussed with an experienced independent Life Insurance Agent. Find someone who will speak with you and discuss your needs and make recommendations based on those needs.
The life Insurance Tool is a critical component in our Financial Tool Box, don’t put the wrong tool in the box!
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