Death is a hard subject to approach. We don’t need to think of it much early in life. But as we get older, we need to start planning for the future.
Accidents happen, and if you don’t prepare, you can leave problems behind. Surveys found that 70% of households with children wouldn’t have enough to survive months after an unexpected death.
But how can you figure out what you need in a life insurance policy? We’ve got you covered!
Keep reading to learn five things to look for when buying life insurance.
1. Don’t Name Children as Beneficiaries.
You want to leave money for your children, but if you name them as a beneficiary, then they won’t be able to receive the policy payout.
Your insurance company will hold up the money until your child turns 18.
When naming your beneficiary, make sure you use someone you can trust to take care of your child. They can help during the process and make sure your child uses the money wisely instead of blowing through it.
2. Find the Right Type of Policy
Not all policies are created equal. They all offer different payouts and different benefits.
Make sure you research each of them to determine which one will work best for your needs. Once you find a candidate, compare each of the policies of that type.
Whole life insurance is one of those policies and one of the more common ones purchased. Read more about how it can help.
3. Check With Your Doctor
Your policy premium will be changed based on your health and lifestyle.
If you are a smoker or have any other health issues, then you could end up with a higher premium.
But if you’ve made lifestyle choices that make you less risky, then your premium will go down.
Make sure to see your doctor so your medical records will get updated to reflect your changes.
4. Don’t Volunteer Information
Insurance companies will take all the information they can get when quoting you a policy. They can use whatever health information they get to increase your premium.
Did your parents have cancer? That’s a premium increase.
Does your family have a history of heart problems? That’s another increase right there.
Don’t answer questions you don’t need to so you can keep your premium low.
5. Go For Annuity Payments
Did you know you can opt to get a gradual payout instead of a lump sum?
This course of action is worthwhile to do. Not only will it prevent misuse of the payout, but it will also decrease the premium you are paying.
If you receive any interest from your payout, then you need to consider this too.
Getting a lump sum will increase your gross income during the year and could move you up a tax bracket. Spreading out payments over time can keep you in a lower bracket.
Don’t Go Another Day Without Life Insurance
Time seems infinite when we’re young. But it isn’t, so we need to prepare before we run out of time.
Make sure you sign up for life insurance today, so you leave something behind after you’re gone.
Preparing for the future doesn’t mean we have to accept death. Head over to our health blog for tips that can help you live a more healthy life.