If you have dependent or loved ones who you want to take care of after you die, life insurance is critical.
But how much life insurance is enough ? That's a question whose answer can change significantly over your lifetime and an important one to answer correctly.
You may be underinsured with life insurance coverage if....
Your only life insurance coverage is through your employer.
If your only coverage is through your employer, you may not have enough. These plans generally offer very limited coverage, which is unlikely to be enough to meet your family's needs if you have any significant debts or family living expenses that need to be met.
Further more, life insurance offered through your employer is usuall contingent on you keeping your job, so if you leave your position for any reason, the coverage disappears.
Finally, buying an individual policy gives you access to different types of life insurance policies, including permanent life insurance, which has living benefits you can use while you're alive.
2. Your Income went up
If you're making significantly more income than you were when you first bought your life insurance policy, you may find yourself underinsured. A higher income usually comes with associated lifestyle changes and learning how to live with less is likely the last thing your loved ones will want to do if you depart unexpectedly.
3. Your stay at home spouse doesn't have life insurance.
If your stay at home spouse doens't have life insurance coverate, you'll want to consider getting them a policy. Even if they don't make an income that would need replacing, they perform valuable services like childcare that would need to be paid for if they're no longer
there.
4. You had a child
Having a child is expensive. If you're a new parent or brought an additional child into your family, it's a good time to review your life insurance coverage and ensure you have enough to meet your dependents long term needs, including food, shelter, and education until their grown.
5. You bought a new home
Paying the mortgage is one of the most pressing financial needs for any family and more pressing for a newly widowed spouse. If you purchased a new home since you first got your life insurance policy, you may find that you need more coverage to help ensure your loved ones can successfully pay down that debt.
While it can feel overwhelming to determine how much life insurance coverage you need as your financial situation changes over time, it's important to ensure you'r sufficiently covered.
My team is always here to help guide and advise you. Feel free to reach out and schedule a consultation.
Comments