Life Insurance – It’s As Simple as 1-2-3!
When it comes to life Insurance, it’s important to know that your coverage will be enough. Sure, it may sound like a complex subject – but it doesn’t have to be! Of course, there are always questions when trying to plan for the future, but Step 1 is to ask yourself: “How much coverage should I actually have?”
Ensuring You’re Insured
There’s a simple calculation you can make to address your coverage needs; however, it may not bridge the gap on every potential short-fall. A good baseline is approximately 5 – to – 8 times your annual salary. Pretty easy, right? While that very simple figure can provide a great place to begin your planning, it may not provide the most accurate number in the long-run. We can help you understand the outliers you should be taking into consideration while making this decision.
A Dinner Party for the Future
You don’t pay your bills with a simple bit of multiplication – you plan and allocate accordingly. The same should be applied to your life insurance coverage. Think of planning for a dinner party. You can do the math, count the guest list, and plan your meal around that simple equation. But what about those guests who never replied, and suddenly show up with extra people? What if the main entrée is accidentally burned? Planning for the expected – and unexpected – is your best bet, and entirely doable! Let’s take some items into consideration:
- Lost income
- Mortgage payments
- Education costs
- Special needs for children or dependents
- Long-term health care expenses
Your lost income could mean the difference of keeping the lights on or putting gas in the car. While no one can see the future, you can do your best to be prepared for anything. Doing your math homework today could save your family a lot of work tomorrow. Ensuring you’re insured can be as simple as 1-2-3! In our next installment we’ll tackle Step 2: “How long should your coverage last?”