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Life Insurance benefits

Financial Literacy | Life Insurance | Tax Prep

Term Life Insurance

Temporary coverage designed to last a specific period of time 10, 20, or 30 years. Usually lower monthly premiums.

Term Life Insurance

Temporary coverage designed to last a specific period of time 10, 20, or 30 years. Usually lower monthly premiums.

Whole Life Insurance

Permanent life insurance policy that provides lifelong coverage. It combines a death benefit with a cash value component.

Universal Life Insurance

Universal life insurance is a flexible permanent life insurance policy that allows policyholders to adjust premiums and death benefits.

Life insurance is a financial product that provides monetary protection to your loved ones in the event of your untimely death.

Key reasons why life insurance is important:

Financial Protection: Life insurance provides financial protection to your dependents and beneficiaries, ensuring that they are able to maintain their lifestyle even in your absence. It can help cover expenses such as mortgage payments, childcare, and education costs.
Peace of Mind: Knowing that your loved ones will be taken care of in the event of your death can provide you with peace of mind. Life insurance can help ease your worries about your family's financial future.
Estate Planning: Life insurance can also be an effective tool for estate planning. It can provide liquidity to pay for estate taxes and other expenses, ensuring that your assets are distributed according to your wishes.
Business Continuity: Life insurance can be used to ensure the continuity of a business in the event of the death of a key employee or business partner. It can help cover expenses such as debt payments, employee salaries, and other expenses necessary to keep the business running.
Lower Premiums: Life insurance premiums are typically lower for younger, healthier individuals. By purchasing life insurance at a younger age, you can lock in lower premiums and ensure that you have coverage in place for the future.

Overall, life insurance is an important financial product that can provide peace of mind and financial protection to your loved ones in the event of your death.

Life Insurance fall under two main categories: Term or Permanent

Term life insurance. This policy type last for a specific number of years and are suitable for most people. If you don’t die within the time frame specified in your policy, it expires with no payout.

Permanent life insurance. This policy type lasts your entire life and usually include a cash value component, which you can withdraw or borrow against while you’re still alive.

Do you really need life insurance?

Although life insurance does not need to be a part of every person's estate plan, it can be useful, especially for parents of young children and those who support a spouse or a disabled adult or child. In addition to helping to support dependents, life insurance can help provide immediate cash at death.

Is a life insurance policy through your job enough?

Limitations on coverage. While your employer's coverage may be inexpensive, it may not be adequate.
Options may be limited by policy.
You don't have complete control.
Leave Your Job.

If you leave or lose your job, you could lose your life insurance coverage and have no protection which is why you should have an individual life insurance policy outside of your employer. "A good rule of thumb is to have 5 to 10 times your salary in life insurance coverage."

How does life insurance get paid out?

Life insurance payouts are sent to the beneficiaries listed on your policy when you pass away. But your loved ones don't have to receive the money all at once. They can choose to get the proceeds through a series of payments or put the funds in an interest-earning account.

Are you taxed on life insurance?

Generally, life insurance proceeds you receive as a beneficiary due to the death of the insured person, aren't includable in gross income and you don't have to report them. However, any interest you receive is taxable and you should report it as interest received.