Life Insurance Quotes

Deciding to buy life insurance: when, and how much?

09/14/11

The decision to carry a life insurance policy often follows a significant life event. Many experts say that while a person is never too young to get a life insurance policy if he or she can afford it, it's really not necessary if he or she doesn't have a spouse or any dependants. Many people choose to invest in a life insurance policy when they get married, even more do so when they have children, and still more as they approach retirement. Knowing when to buy and just how much life insurance to purchase can be difficult, but is often an organic process, and should not be too daunting, according to an article in the Colorado Summit Daily.

The source notes that when gauging the amount of life insurance to buy, some financial advisers suggest considering your salary as 6 percent of the total insurance value. If you make $60,000 a year, for instance, a $1 million policy would be appropriate.

The Insurance Information Institute notes that a life insurance policy covers a number of expenses in the event of a policy holders' death. While some say that their spouses' income is enough to sustain their families, it's a good idea to consider the effect of final expenses, federal death taxes and a potential increase in expenses or a loss in wages. While a spouse's income may support a child on paper, consider the effect of utility bills and other expenses that might have been paid by the deceased.

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