Societal changes and advancements in technology have made it possible for people to choose to remain single and never have kids. If you're in this rapidly rising demographic, it's easy to believe you don't need life insurance. The truth is that you probably need it even more than your friends who are married or parents. Here are three reasons why.
Take Care of Your Loved Ones
When people think of life insurance, the first thought that comes to mind is ensuring spouses and/or kids have money to take care of their financial needs after one of the primary breadwinners passes away. As a single person with no kids, it's important to also consider other people who may depend on you financially now or in the future.
For instance, over 65 million people take care of family members or friends who are disabled, chronically ill, or elderly. If your parents are reaching the age where they need assistance, having a life insurance policy ensures there will be money available to continue paying for their care if something happens to you.
Nieces, nephews, godchildren, parents, aunts, uncles, and best friends are all people you should consider when determining whether to take out an insurance policy. If any of these people depend on you financially now or will need your financial assistance in the future, it may be a good idea to get a policy and assign beneficiaries.
Pay Off Debts After Death
Another reason to purchase a life insurance policy is to use it to pay off your debts after death. Debts don't disappear when you die, unfortunately. Creditors will typically circle around your estate and pluck up any spare, non-exempt and unprotected cash to pay for the money you borrowed when you were alive. This can make it difficult to properly administer your wishes and may even result in legal consequences for your heirs.
For instance, if you're behind on your property taxes, the government can put a lien on the home that will negatively impact your heirs' ability to sell or transfer the property. If the lien goes unpaid for long enough, the government could eventually foreclose on the property and force your heirs to sell to pay your tax debt.
Additionally, anyone who has cosigned debts with you (e.g., home loans, student debt) will be responsible for paying off those accounts, even though you are no longer around. The parents of one young woman was stuck paying back $200,000 in student loans debt after the woman died due to liver failure because the father cosigned the loans, for instance. While a person can get governmentbacked loans forgiven by filing a petition with the appropriate agency, private lenders are under no obligation to do this. As such, they will often continue to pursue collection of the debt years after the original debtor has passed on.
A life insurance policy can infuse your estate with the cash needed to pay off any bills not already covered by other assets. This will reduce the financial burden on your loved ones and ensure they're not unfairly stuck paying debts they don't really owe.
Pay for Your Funeral
The last reason you may want to get life insurance is to ensure there's enough money to pay for your final expenses. It can cost anywhere from $7,000 to $10,000 to pay for a funeral. If your estate doesn't have enough money to cover the cost, it will come out of your loved one's pockets.
Like with your debts, the money from a life insurance policy can be used to pay for your burial or cremation. This ensures your loved ones get the closure they need without draining their bank accounts or bankrupting your estate.
For more information about these issues or help selecting the right life insurance policy for you, contact a brokerShare
1 September 2017
I have always been someone who loves to work hard for what they have, which is why I started paying attention to how I was protecting my investments. I realized that although I had great medical and dental insurance, my car needed a little extra protection. I started working hard to find an insurance policy that would work well for my needs, and before I knew it, I was able to sign up for a new policy. This blog is all about choosing a car insurance policy that works well for you and your family, so that you don't have to worry about falling short.