Linda R

Society is awash with stories and varies media worldwide that involves the protagonist finding the fountain of youth.  Whether or not the outcome has a happy ending is as varied as the stories.  People have even confused fiction with reality and tried to find ways to cheat death.  As Jon Foreman stated; “Death is the certainty. Life is the unexpected gift.” Life insurance enables us to plan for both events which I have discovered from the lives of two different people.

Though death is a known in a world of variables, when it will happen is not.  But as humans we tend to ignore this truth in an effort to get through the daily needs that occupy our thoughts.  “I will get to it tomorrow,” seems to become a universal fallacy.  It was part of my life and of a friend of mine, Meagan, and her husband.  Though not self-assured enough to believe that they were superhuman, when you are under the age of thirty and healthy it feels as though you are.  Life insurance, finance major recited to us, “in exchange for premiums (payments), the insurance company provides a lump-sum payment, known as a death benefit, to beneficiaries in the event of the insured’s death” (www.fidelity.com/life-insurance-planning/what-is-life-insurance, viewed 10/3/2015).

Meagan and her husband being newly married and still in college, felt that their money could be spent in better ways, that insurance could be put off for when they had more discretionary money.  A year after their marriage Meagan’s husband was diagnosed with terminal cancer and was given six months to live. They discovered, as bankrate.com reports, “there’s a saying about insurance: You can buy it only when you don’t need it. That’s generally true for all types of insurance, unless a federal or state law makes it mandatory that insurance companies accept everyone…. However, no such law applies to life insurance” (Jack Hunglemann, http://www.bankrate.com/finance/insurance/cancer-patient-life-insurance, viewed 10/3/2015).  In the end, they had lived life and enjoyed their time together but hadn’t thought what she would need to help her carry on without him. It resulted in her becoming overburdened emotionally and financially, some of which could have been remedied by purchasing life insurance early.

When my husband and I were newly married we were told a story by my in-laws that they use share will all their children starting a family teaching the importance of not only buying life insurance but the right amount.  A relative of my husband’s had eight healthy and happy children and a moderate income to comfortably take care of them.  He realized that he needed to make provision for those that matter the most to him and purchased a life insurance policy.  What he did not understand and failed to research is how much insurance he needed to purchase.  In order to save money and not seeing the need to pay a large premium, thereby putting that extra money towards a new car that the family needed instead, he bought a small policy that would pay out the same amount as his yearly salary.  Unfortunately, this individual died in an auto accident.  The life insurance was able to pay for the funeral and provide a few things for the family but not for long.  His wife was forced to take odd jobs to provide for her family; her stress could have been alleviated with more knowledge.

According to CNBC there are three steps to decide how much insurance a family needs: 1. Evaluate your family’s needs. How much money does it take to run your household? Do you have unpaid medical bills, a mortgage balance and/or outstanding debts? Don’t forget to add funeral expenses and possible estate taxes to the mix. 2. Consider future financial obligations. You should also have enough coverage to pay for future financial obligations.  3. Tally up the resources. Now look at the money that would be available. What is your spouse’s income? Do you have long- and/or short-term savings? Add up the balances in your 401(k)s, IRAs, 529 college savings plan, emergency reserves and estimated Social Security survivor benefits, as well as any existing life insurance policies (perhaps through your employer).  The difference between your family’s financial needs and the available resources will tell you how much life insurance to get (Sharon Epperson, http://www.cnbc.com/2014/10/03/how-much-life-insurance-do-you-need.html, viewed 10/3/2015).
Experience is the best educator and fortunately my husband and I have learned from others the importance of preparing for the future.  Purchasing life insurance not only provides a person with financial reassurance but is a tangible demonstration of love for their family.  By breaking out of the normal thought pattern of leaving responsibility for tomorrow, you and your family can breathe easier.

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Enhanced Insurance is not written by attorneys. If you’re looking for legal advice, you need to contact a lawyer. Further, insurance practices and forms change constantly and are varied from state to state. For definitive answers in your area, contact a local agent.