I don’t know how it is September already! Summer flew by in a flash! In the SBJW Insurance world, the kiddos are back to school and momma is creating new content about life insurance for Life Insurance Awareness Month.
To be completely transparent, I bought life insurance when I was in college. I understood that term life insurance was really cheap and it gave me a discount on my auto insurance premium. (My driving record was not stellar, so I was looking for any credits I could get!) As I have gotten, older I have realized the importance of having life insurance in place to protect my children. I certainly don’t want their quality of life to suffer if something would happen to me. I don’t want them to have to skip college because I’m no longer around to provide income. If something happened to me, their life would be hard enough just having to deal with a horrible situation like that. They certainly don’t need an added financial strain in their world on top of losing a parent!
These are my reasons for buying life insurance coverage. There are so many other ways that you can use life insurance and structure it to best meet your financial goals.
If you want to be your own bank, you can create a life insurance plan that accumulates cash value while at the same time providing a death benefit in the event something happens to you. Interest rates on the cash value are typically higher than what is currently paid at banks. And, policy loans/life insurance death benefits are not considered taxable income. You could also set up a life insurance plan to pay tax on 401k distributions that might be paid to your beneficiaries at your death. You can also use a life insurance death benefit to pay estate taxes – such as capital gains. Have you ever dreamed of seeing your name on a building? You can set up a life insurance plan and list your favorite charitable organization as the beneficiary. Some life insurance carriers have recently introduced life insurance plans that allow you to access your death benefit early if you are diagnosed with a terminal illness.
The possibilities are endless! Check with your insurance agent to see what plan would work best with your financial goals.