What should I do about life insurance?
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What should I do about life insurance?
| Wed, 10-22-2008 - 10:24pm |
I am working through my list of bills trying to
| Wed, 10-22-2008 - 10:24pm |
I am working through my list of bills trying to
Term life insurance is there to help your dependents if you die. If you have children, you owe it to them to have life insurance.
Any other kind of life insurance is a variety of investment, and it is not what you need when you are trying to save money. Almost any type of investment vehicle is better than life insurance!
Think seriously about your life insurance. If you died, what would the financial impact be on your family? If your husband died, would $100,000 be enough for you to live the lifestyle you have now? Would you be able to pay his funeral expenses, your mortgage, and pay people to do the things he does now? What about if you and your husband both died? Is $200,000 (what you are considering now) going to be enough to pay off all your debts, your funeral, and provide an annuity to the guardians of your children?
I'm insured for $750,000, and my DH, who is a SAHD, for $250,000. If he died, I would be able to pay off most of the mortgage, which would be free up about $1500/month for me to pay people to do all the work he does now, including hiring a babysitter to help in the afternoons. If I died, it would allow DH to pay off the mortgage and be able to live off the income from the remainder, if properly invested, and then pay for the kids' college. If both of us died, the $333,000 each of our 3 children would inherit would be enough to send them to college and enable their guardians to buy a bigger house to keep all our children as well as their own families.
Don't scrimp on insurance. It is there for disasters, and one disaster can be enough to ruin your life forever.
Kelly
Thankyou for all the information, it was actually very helpful. So let me ask you a few more since you seem to know what you're talking about. My husbands job is currently upgrading their Supplemental Life plan and according to his bosses, it's the best they have ever offered. He will pay .08 cents per $1,000 dollars of coverage. He currently makes about 50K a year and I make a very basic work from home 10K. I provide the childcare, which if my husband didn't have me would
I wouldn't count on an employer sponsored plan. If you are still young, which you probably are, then you can get a good term plan cheaply. The employer stuff can be additive, but if he lost his job, then you'd be buying new insurance when you don't have income to begin with.
When I reached a certain level at my job, I received a $500K life insurance plan from my company. That's nice, but I didn't give up my current policy. I figure it is just additional money that will make life easier for my husband.
Does your DH have disability insurance? If not, you do need to get that NOW. You are far more likely to be disabled during your working career than to die. A colleague of mine learned that the hard way, when her husband had an eye injury that meant he couldn't perform his job. He had no disability insurance and, once he couldn't work, no job. Disability insurance is more expensive than term life insurance, but you're much more likely to need it, so please be sure your husband has it. We couldn't get disability insurance for my DH, because he's a SAHD, but I have it.
Kelly
I am really lucky that DH's job is updating their benefits at the moment, otherwise I would never have looked through our coverage and realized that we're not covered! I am going to look into all this stuff today. Thanks for the info!
Abbie