Be Wary Of What You Hear About Life Insurance

I've seen a few things recently that concern me and I thought that it was important that I share my concerns with you before someone makes a big financial error that might hurt them and their families in the future.

A little while ago I found a page online that, unfortunately, I can't share for legal reasons, that stated that you only need to have life insurance that equals to three times your annual salary. This disturbs me and no, not because I tell people that people should purchase more than that as a general rule, but because everyone and their families are unique and have different personal needs, family needs and obligations. There is no way that a qualified life insurance agent will tell you this. Why? Read this.

Here's a quick example of why this won't work most families Let's say that we have a family of 4 where the children are young, ages 7 & 5, respectfully. The wife is a housewife and has no job experience other than working at KFC as a teenager, which was a long time ago. The husband brings home the money and makes a decent income of around sixty thousand per year and, like most of us has bills to match that annual salary.

They live in a nice home that they're buying, have two vehicle payments, Health Insurance which, even though it's included as a job benefit for himself (after deductibles), he still has to is required to} pay to insure the family. They also must pay auto insurance for two cars, life insurance for four people, in different amounts, homeowners insurance, dental insurance and let's not forget all of the other regular expenditures such as groceries, electric ect. Also, they must send money every month to pay for his mother who is in a care home.

There are many other things that could be added into this and I could also easily add more and more monthly obligations, but do you see how the bills stacked up for this family?

This may even be similar to your own situation,living situation, give or take. In case of this man's untimely death do you really think that three years worth of his annual income would be a sufficient amount of life insurance for this family? Let's do some figures.

With the man of the house bringing home an annual paycheck of sixty thousand dollars that multiplied by three years would give this family $180k coverage of life insurance. This may be stretched into 4 years worth of living money considering that the man of the house is now gone, but that only brings the kids to the ages of 9 and 11, what then?

It's possible that the man could have allowed for this happening, even beyond a normal life insurance policy, by also taking out a "Mortgage Life" policy that would pay off the house in the event of his death. He may have also made allowances in the vehicle contracts. But what if he forgot? Even if he'd done this it still might have stretched the families living expenses another 3, maybe 4 years, depending on how much they cut back on unnecessary things. That would bring the children to the ages of thirteen and fifteen now. What about the next five years until the younger child turns 18? What about college for both of them? Do the couple's parents have burial arrangements? They probably don't if this couple is already sending money each month for the mother's care.

This is all simply a unique example of a common American family, but I wanted you to just take a moment and really think about these things. The only way that you can determine how much life insurance is enough for you and your wife and kids is to actually sit down and look at every bill that you pay now the bills that you know you'll have in the future, all of the variables that could happen (if these didn't happen there might not be a need for insurance) and then when you think you've got a good solid number, add an additional 20% just in case. It's always better to have too much than not enough.

If you are the primary support of your family wouldn't you want to know for 100% certain that your family was going to be okay in the event that something happened to you, no matter what the circumstances were? I thought so, me too. The only point that I'm trying to bring to your attention is to not let someone else dictate to you how much life insurance you need. Sit down with your spouse and then get ahold of a qualified agent. Do it right the first time because, unfortunately, there is no second chance in these life and death circumstances.