The following five questions will not only help you determine if you still need life insurance, but what amount of life insurance you may need, and what type of life insurance may be right for you.
1. Do You Need Life Insurance?
Will someone experience a financial loss when you die? If the answer is no, then you don’t need life insurance.
A good example of this would be a retired couple with a steady source of retirement income from investments. Their income would continue in the same amount, regardless of the death of either spouse.
2. Do You Want Life Insurance?
Even if there will be no substantial financial loss experienced upon your death, you may just like the idea of giving up some income now so that family, or a favorite charity, will benefit upon your death.
Life insurance can be a great way to pay a little each month, and leave a substantial amount to a charitable cause.
3. What Is The Right Amount of Life Insurance?
Think about your situation, and the people who will experience a financial loss if you were to die today. What amount of money would allow them to continue without experiencing such a loss? That is the amount of life insurance you need.
4. How Long Will You Need Life Insurance?
Will that financial loss always be there? Probably not.
If you’re in your peak earning years, and you’re not around, it may be difficult for your surviving spouse to save enough for a comfortable retirement.
But once retired, the family income should be stable, if the source of the income is not dependent upon either life. If this is your situation, then you only need insurance to cover the gap between now and retirement.
