How Much Life Insurance Do You Really Need

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Life Insurance Premium Calculator  
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How Much Life Insurance Do You Really Need?
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Not many people enjoy thinking about their death,
and fewer still even remotely consider the
possibility of an early death. Still, one should
take the time to think about it, especially when
it comes to the financial safety of your family.
Do you have enough money to pay all your debts
and cover your funeral expenses? What about
taking care of your family after you are gone?
Life insurance is designed to create a safety net
for your family in the tragic event of your
untimely passing. But how much do you really
need?1. Should everyone have life
insurance? Before we can even consider how much
life insurance you should purchase, you need to
decide if you really need it at all. Buying life
insurance isnt right for everyone. If you are
single and dont have any dependents, you might
not need it. This is assuming you have enough
money saved up to cover the cost of your funeral
expenses and debts if you do pass away. If you do
not, you may want to consider life insurance even
if no one is counting on the money you bring
in. You dont want your family members having to
pick up the tab for your death. So take a hard
look at your finances and the money you have
saved. If you have enough saved through your
various accounts to cover all your expenses when
you die, there is simply no reason to waste the
money on life insurance.
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2. Life insurance and your age One of the
greatest myths about life insurance is that it is
harder to get as you get older. Insurance agents
are notorious for hinting that this is true,
although they will never come out and say it
directly. That is because it isnt true. If you
purchase life insurance when you are young, your
premiums will be very low compared to waiting
until you are older. That is because the
insurance company is betting on you living. If
you do happen to die early, then you were a bad
investment. However most young people live for a
long time, making it a pretty safe bet for the
insurance companies. If you didnt pick up life
insurance when you were young, dont believe that
you cant get life insurance. Insurance companies
will charge you more for your insurance, as you
will present a greater risk to the company.
However, you should still get approved. The
question becomes, can you afford to pay the
higher premiums? Once you reach retirement age
and are on a fixed income, it will most likely
become more difficult to afford the payments, but
the ability to qualify for life insurance wont
go down just because of a few extra years under
your belt.
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• 3. Determining your insurance needs
• The largest part of choosing a Life Insurance
  Premium Calculator is determining exactly how
  much you will need to take care of the expenses
  of your death as well as be sure your family
  members are taken care of if something does
  happen to you. While you can use a life insurance
  calculator to help you calculate the final sum,
  you must be aware of all the different financial
  aspects of your life you must cover in your
  policy.
• How much debt do you currently have?
• All of your debts must be taken into account when
  you pass away. This includes your mortgage, car
  payments, and credit card debt. In any policy you
  take out, you want to be sure you have enough
  money to cover the costs plus any extra interest
  that gets added to the loan. For example, if you
  owe 100,000 on your home plus you have 20,000
  left to pay on your car and 10,000 in credit
  card debt, you will need a minimum of 130,000 to
  pay off these debts, although you may want to
  consider adding a little more to be sure any
  interest is covered.
• Does your insurance need to cover income
  replacement?
• If you have a family that counts on your income
  to survive, you may want to consider adding in
  enough money onto your life insurance policy to
  ensure that they dont lose that income if
  something unfortunate happens to you.

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Will the policy need to cover other future
expenses? On top of your income and any debt, you
will also want to cover other future expenses
that go above and beyond your salary replacement.
Do you have children? If so, you may want to
build in a set amount of money for them to go to
college someday without needing to take out
thousands of dollars of loans in order to get
their education. Does your insurance also need
to cover others? There are most likely other
people in your life who may need to be insured.
As a rule, you only insure people who
would constitute a financial loss if they died.
The death of a child, while emotionally
devastating, doesnt cause you to lose income.
Source http//www.cheatsheet.com/personal-fina
nce/how-much-life-insurance-do-you-really-need.htm
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