Life insurance is one of those subjects no one really likes discussing. Partly morbid, partly daunting... but mostly life insurance seems inaccessible for many. You might even think that life insurance is something only for the wealthy (or... "mature"). But the truth is that death is a fact of life - so planning for it is incredibly important, no matter who you are. And you might be surprised to learn that this process doesn’t have to be complicated or expensive.
We meet many incredible young parents these days who love their children deeply enough to stress over things like BPA-free bottles or hormone-free baby food. Of course those things are important, but sometimes what’s neglected is the bigger picture: if something happened to a child’s parent or caregiver, where would that leave the child? Would there be enough money saved to ensure that your family could continue to afford the things (like organic peaches) that were so important to you?
Even a stay-at-home caregiver provides substantial financial benefit to the household. If suddenly there was no one available to fill that role, and the children would require daycare or a full-time nanny, could your family sustain that expense on a single income? If you had to pay someone to do everything you do, could you? That question is practically an insurance agent cliche, but it certainly provides food for thought (ok, enough cliches!) for many parents.
If your household consists of older children who might not require as much constant care, another consideration is the college savings fund. In 2015, four years at a public university cost nearly $100,000. Current projections indicate that by 2020 alone, that number could increase to nearly $150,000 and substantially higher for private or out-of-state universities. A life insurance policy could help finance your children’s higher education in the case that you or your spouse weren’t there.
Perhaps you do not (or no longer) have children who depend on you. Even still, funerals are often an unexpected expense for loved ones. In 2015, the cost of a funerary arrangements can rival the cost of weddings! Side note: the FTC has a handy Funeral Costs and Pricing Checklist should you ever be handling these arrangements for a family member. Even a basic life insurance policy can dramatically offset the cost of these services, so you can feel confident that your loved ones won’t have to worry about money on top of their grief.
At RTI we recommend that essentially everyone (at least every household) purchase a life insurance policy. For providing such a crucial safety net, the cost of these policies can be surprisingly low. However, unlike wine, life insurance does not get better (read: cheaper) with age. It’s best to invest as early as possible to lock in lower rates. Call RTI today to learn more, or contact us here.
PS - we love a good infographic! Check out this cheat sheet by Bankrate that reiterates the importance of life insurance for any household.