For hundreds of years, life insurance has served to provide much-needed income to dependents in the event of the insured’s death. That’s the main purpose we imagine when we think of life insurance. And yet, society has changed, and life insurance policies have changed along with it. There are now as many uses for life insurance as there are needs!
Aside from replacing lost income, what are some other uses for life insurance? The answers might surprise you!
Cash value for education. The accumulated cash value in some types of life insurance policies can be used to finance a higher education. Of course, if this is your goal then you should discuss it with your insurance professional before purchasing the policy.
Equalizing inheritance. Let’s assume you have two children, and most of your personal worth is tied up in your physical assets such as your home. By purchasing a life insurance equal to the value of your physical assets, you can ensure that each child receives an equal inheritance, rather than having to split the sale of the assets (which can take time, or which one recipient might not want to sell).
Debt protection. We all intend to pay off our debts before retirement – or at least before we die! But since death can be unpredictable, it’s a good idea to protect your loved ones from excessive debts. A life insurance policy can be used to pay off debts after you pass away, protecting your heirs from having to sell the family home or other assets.
Leave a legacy. If you want to leave the world a bit better than it was when you joined it, a life insurance policy can be gifted to the charity of your choice. Upon your death, the organization receives the funds in your name.
Hedge against estate taxes. The last thing you want is to leave your heirs burdened by heavy estate taxes. If you meet with a financial expert and estimate your future estate taxes, you can then purchase a life insurance policy in that amount.
Protect yourself while you’re still alive. If you add a living benefits rider to your life insurance policy, you can access your death benefit under certain circumstances while you’re still alive. These funds can be invaluable to you and your loved ones when you experience a terminal illness.
Business protection. Business owners should worry not only about their own loved ones, but the future of their company and employees. Life insurance offers various ways for business owners to protect this important asset, or create a succession plan in the event of their death.
For more information on how life insurance can protect your future and your loved ones, call our office to schedule an appointment. For nearly every need, there is a solution!