Financial planning includes determining how much auto, home, and business insurance is required to protect your assets. However, when it comes to life insurance, you’re looking for a policy that will protect the people left behind when you die.
1. Putting it off too long
One of the most significant risk factors for dying is age. The older we get, the closer we are to taking our final bow.
2. Counting on your employer
If you’re a full-time employee of a mid- to large-size company, chances are you have some employer-sponsored life insurance. If that’s all the coverage you carry, losing your job to another pandemic or layoff could leave you vulnerable.
3. Buying too little
It’s easy to underestimate how much your beneficiaries will need to maintain their current standard of living if you die. The amount of life insurance you need depends on how long your beneficiaries will need support.
4. Allowing your policy to lapse
Life can throw some unexpected curveballs, including job loss, business failure, and serious illness. As you work with a licensed insurance agent to find the right policy, balance the coverage you need with a premium you can reasonably afford to pay.
5. Failing to reassess your needs
Your life insurance needs at age 22 will differ from those at age 40 or when you’re 60. At least once a year, take a peek at your policy to remind yourself of how much you are carrying. Determine whether you need more to meet the growing needs of your beneficiaries