Whether you're raising a family or entering retirement, the right coverage ensures your loved ones stay protected.
February is “Insure Your Love” Month.
Insure Your Love month was created to remind Americans that the basic motivation behind the purchase of life insurance is love.
People want to protect their loved ones, and one of the best ways to do that financially is with life insurance.
Do you love someone? If the answer is clear, then so is the answer to whether you need life insurance.
Because the truth is, life insurance is for anyone who loves.
Whether you love your spouse or partner, your children or grandchildren, your parents or a favorite charity, life insurance means they're protected financially if something happens to you.
And while most of us have loved ones that we wish to protect, a recent survey revealed that 106 million adults are in need of life insurance—or more of it.¹
This may be due to the fact that many people—around 40%—are largely uncomfortable talking about end-of-life planning with their loved ones.¹
No one really wants to think about life insurance. But if someone depends on you financially, it’s a topic you can’t avoid.
Is life insurance worth it?
There are many answers to the question of why life insurance is important. But by and large, the most important one is ensuring your family’s financial security and peace of mind.
If anyone depends on your income, they would most likely struggle if you were to pass away. That’s why life insurance is so important to have.
There are different types of life insurance policies, but essentially, they all pay cash to your loved ones when you die. Money from life insurance can be used to cover daily living expenses, mortgage or rent payments, outstanding loans, college tuition, and other essential expenses.
Life insurance is the best way to ensure that your loved ones would be in a good financial place if you and your income were no longer in the picture.
Do I need life insurance?
If someone depends on you financially, you are most likely someone who needs life insurance.
Life insurance provides cash to your family or loved ones after your death. This cash, known as the death benefit, replaces your income and the many non-paid ways you support your household. Your family can use this cash to pay for expenses like funeral costs, a mortgage, college tuition and more.
Just a few examples of people who often answer “yes” to the question of “Should I get life insurance?” include:
- Married or partnered couples: Many partners find it difficult to make ends meet without the other earner’s income in the picture.
- Married or partnered couples with kids: In addition to losing one partner’s income, the surviving parent may have to pay for childcare and more without the other parent around to pitch in.
- Empty nesters: Many surviving partners would not be able to maintain the lifestyle they worked so hard to achieve without life insurance.
- Retirees: Depending on the size of your estate, your heirs could be hit with an estate-tax rate of up to 45%. Fortunately, cash from a life insurance policy gives heirs access to tax-free money to pay for immediate costs and more.
Life Insurance in Retirement
For federal employees approaching retirement, you may be asking, “Once I’m retired, how much life insurance do I really need?”
Of course, like most retirement decisions, it depends on your situation.
Be sure to listen to this webinar replay to help you understand your choices and needs when it comes to life insurance: FEGLI Options in Retirement – Keep it, ditch it, or customize it in retirement.
In this webinar recording, I explore why many people wish to keep some or all of their life insurance in retirement and what FEGLI coverage you are allowed to take into retirement.
Even if you feel that you have enough life insurance for your loved ones, I encourage you to watch this webinar to ensure that you have the right FEGLI options and the coverage to suit your family's needs.
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¹Source: 2022 Insurance Barometer Study, Life Happens & LIMRA