Money makes the world go round. While you're working and caring for your family, you understand the importance of finances and taking care of them. In the event that anything ever happened to you or your spouse those same finances are just as important. Having life insurance is a precautionary measure against the worst, and ensuring that your family won't need to worry after you pass.
Read on to know more about how insurance plays a vital role in your family’s financial security.
Accidental death happens
Even if you and your partner are young parents without any health complications, you should have a plan in place in case anything happens to one of you. You always want to plan for the worst and hope for the best. Accidental deaths do happen, and you want to make sure that you aren't leaving your loved ones with debt and a reduced income.
The guys at the Money Expert say that people who work in high risk environments often want to obtain personal accident coverage. Even if you don't work in a high risk environment, it's always better to be prepared, as accidents do happen in low-risk environments too.
If you happen to have accumulated debt prior to your passing, you don't want to leave your family with the financial burden of paying it off. Life insurance is going to help prevent passing on debt to your loved ones, especially now that they may be a single income household. Not to mention that the added responsibility of having to make mortgage payments without an additional income could become difficult for one person. There are numerous policies that are geared directly towards simply paying debt off if that is your biggest concern. Or if you are currently financially constrained and can only manage to pay off lower premiums those policies might be what you're looking for.
Single income households
If a spouse passes away, the financial burden of caring for the household is now dependant upon one person. When you have children at home this can be difficult to budget with a diminished income. If one partner was making more money than the other partner this going to offset the household budget more than if the earnings are split 50/50. Having insurance is going to be protected against this outcome, and you can decide on a Joint Life Insurance Policy. Even though a Joint Life Insurance Policy covers both spouses at the time of death, it will only offer a payout once, so if the partner who is earning more happens to pass you can choose to accept the payout.
All of the financial goals that you and your spouse may have set will become far more difficult based on a single income. Saving for your children's education, helping them get their first car, or having a nest egg for household repairs might not be a realistic expectation anymore. Go over insurance policies with your significant other and compare them to your future financial goals. Make sure your policy has a payout that's going to meet both of your expectations if one of you isn't bringing home income any longer. Having suitable life insurance may determine whether or not your children might be able to attend post-secondary education so you're going to want to have a sit down and discuss what works best for you.
Now that all of the responsibilities fall on one person's shoulders, unexpected expenses might also come into play. Your spouse may need to be using a day care service which wasn't needed before given your schedules. The cost of the funeral is going to increase spending with the average funeral cost ranging between 7 000 – 10 000$ USD. If you have absolutely no life insurance, a death is going to accrue more debt for your family. So having a policy that at least pays out funeral costs should be something you should consider if you're opposed to the idea. You don't want to leave your family with more debt, and not less, in the unfortunate event something happens to you or your spouse.
Life insurance plays a huge role in keeping your family's financial security intact. Without an adequate life insurance plan you could be leaving your spouse with the debt of a house, or having to manage the bills with just one income. The ability of you and your spouse to save for your children's educational future is severely reduced, and the added costs of a funeral, and unexpected future fees can accrue more debt. You want to be covered in case anything ever happens, none of us can plan for accidents. This makes clear that investing in an insurance policy is mandatory to knowing your family will be secure financially in the future.