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"Our deepest fear is that we are powerful beyond measure...
As we are liberated from our own fear, our presence automatically liberates others." ~ Nelson Mandela

Do I Need Life Insurance?

In the simplest terms, life insurance protects those that depend on your paycheck as their source of income. Life insurance is a common part of estate planning in the United States, though it's not necessarily for everyone. It can, however, be quite useful and necessary for parents of young children, those who support a spouse, disabled adult, or child, and others. Life insurance policies are designed to provide cash to your family to support dependents, pay off debts, funeral expenses, and income or estate taxes. If you have no minor children or financially-strapped dependents, life insurance may not need to be a part of your estate planning, but it's important to fully evaluate your needs. You should also keep in mind that life insurance is not meant as a way to leave a life of luxury for your future generations. Instead, it's fundamental purpose is to provide an immediate source of income protection for your dependents.

To determine if you should have a life insurance policy for long-term needs, ask yourself these questions:

How many people depend on your earnings?
How much money would your dependents need for living expenses?
How long would it take for your dependents to become self-sufficient?

Asking yourself these questions will help you determine if you need life insurance and help you to estimate how big of a policy you should purchase. For instance, if your children are almost out of college, they probably won't need as much support as those that are still young.

To determine if you should have a life insurance policy for short-term needs, ask yourself these questions:

Do you have substantial debt or taxes that will need to be paid off?
Could your family afford funeral expenses?

If you are single with no dependents, it's not likely that a life insurance policy is needed. However, if you are the sole breadwinner of a large family, life insurance should be a priority high on your list.

If, after evaluating these questions, you determine that life insurance is something you need, it's time to decide what type of life insurance to purchase and how much.

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