The answer is no. Think about this…You love your family, right? You don’t want to leave them with the burden of debt in case of an unforeseen even, right? But how can you ensure that your family is not dealing with having to pay off debts while they are grieving in their time of loss? By having the proper amount of life insurance, of course.
As a financial planner my job is to make sure that clients have the savings and protection they need to be financially stable now and in the future; this includes saving for short term goals, investing for retirement and insuring credit products. When I approve a mortgage application I always offer life insurance to clients so that their family and their home are protected in case of an unfortunate or untimely event. Although sadly more often than not clients don’t take life insurance on their most valuable asset because they feel that they can’t afford the extra cost. I say sadly because that statement couldn’t be farther from the truth.
Your family inherits your debts along with your assets
The truth is that people can’t afford not to have a life insurance policy to protect their assets and their family in case of an unfortunate event. Could you imagine losing your spouse or your parent and then also losing your home? For most of us that is an unimaginable nightmare that can be avoided with the right life insurance policy.
I want to help clients fully understand the true value of life insurance as a financial product and as a form of protection for the future of their loved ones. The truth is that life insurance can fit into anyone’s budget and anyone with credit card debt, mortgage debt or other types of personal debt should have life insurance to pay off their debts, protect their assets and avoid leaving debt to their family.
Shop around for life insurance and get three quotes
Justin Thouin is the President and CEO LowestRates.ca, he confirms that clients should shop around to find the best rates possible for the coverage they need when buying life insurance. Life insurance kind of has a reputation of being a non-flexible contract product and people hate the word contract. But with the right financial advice and good financial planning life insurance can be a truly great financial product.
Many of my clients say that they don’t want life insurance because it’s a waste of money, but that is also not true. Life insurance protects us in case of an unfortunate event and we just never know when that is going to happen. Having the right amount of life insurance fits perfectly into your estate planning and it’s definitely worth the cost of the monthly premium, but having too much insurance can be an unnecessary cost. With the help of a licensed life insurance agent or a life insurance calculator you can find the perfect amount of insurance to cover your estate needs.
Life insurance is a part of your financial planning
Thouin confirms that “All too often Americans spend more of their hard earned money than they should because they do not have the time or knowledge to compare offers from multiple vendors before purchasing big ticket items” and this has to stop. If you would shop around and take the time to find the best credit card, why not do the same for your life insurance.
Start where you are comfortable, go and see your financial institution for a life insurance quote. You can also ask around and get a referral from a family, friend or co-worker. It’s a good idea to shop online and compare life insurance quotes in their local area. Be sure to get a quote for the same type of coverage to make sure you are comparing apples to apples. And never, no matter how much you may feel pressured, don’t buy more life insurance than you need – because then it’s just a waste of money.
– Tahnya Kristina, CFP
Photo from flickr