What is Life Insurance and why it's important?
What is the most valuable thing you own? Our bodies are the most valuable resource we have. Our ability to earn money, be productive, and contribute to our family’s dynamic are important resources. We are all unique and the world would not be the same without us. For these reasons it’s important for everyone to have life insurance.
Of course life insurance is not mandated by the government like car insurance and health insurance are, but we would argue it’s more important. Simply put, life insurance is a contract between you and a life insurance company stating that if you die the insurer will pay your beneficiary(s) the death benefit.
Beneficiaries are the people you designate the funds to be distributed to if you pass away. Generally this is your spouse, children, or a family member. However, you can designate anyone or any organization or even a life insurance trust you would like to receive the proceeds.
The death benefit is the amount of coverage you choose when you establish your life insurance policy with the insurer. People like TreeceCo help you navigate this process and give guidance on what to buy and what not to buy. Like anything there are really bad life insurance products to buy and there are really good ones. Whole life and universal life insurance are permanent policies and normally have more options and bells and whistles, but oftentimes the death benefit is not as high as term insurance. However, with some policies you can have a blend of term insurance to get a higher death benefit and whole life so that the money you are putting into the contract can grow.
A common objection people state when they choose to not purchase life insurance is that their employer offers life coverage. What some people may not realize is that when they lose their employment or retire, normally their life insurance is gone too. It is important to have a contract that you own and control. Plus the older we become the more expensive a coverage becomes, and our health sometimes changes. This can cause it to be financially unfeasible to buy life insurance. It’s important to lock your ability to be insured while you are healthy and able.
You may be thinking this sounds drab. Let’s make it more fun!
Whole life insurance may allow you to put in a lump sum of money one time, and you may be able to select whether to continue making premium payments or not. Your money often grows at a guaranteed rate of return. Then as your money grows you may be able to take a tax-free loan from the money inside of your policy. Why would you want to take a loan from your policy? Many people do this to make a down payment, pay for medical expenses, fund a child’s education, and the list could go on. And many people may be able use a well-structured life insurance plan to fund their retirement using tax-free methods. It’s imperative to speak with an expert when trying to achieve this goal. The average life insurance generalist will not be able to help you with this. TreeceCo specializes in this process.
Life insurance companies are the only financial institution that allows you to save money, have guarantees, and are the safest financial institutions. No other financial institution will give you a contract for each dollar you save or invest with the company.
There are many options and TreeceCo will be your guide in navigating the sea of decisions.