Factors to Consider When Choosing a Life Insurance Policy
A life insurance policy can be a very valuable asset in your estate. Therefore, it’s important to carefully consider the kind of policy you want and the amount of life insurance benefits you wish to purchase.
Here are just a few examples of some of the factors that should play a role in your decision about how much coverage you need:
- Cost of death: Consider the various funeral and burial costs as well as the potential hospital bills you’d rack up before death.
- Grief fund: Budget in some money to give your family members a grieving period in which they can afford to take off of work for some time after your death.
- Educational expenses: If you have young children, you can use life insurance proceeds to set up college funds for them.
- Lost income: Your lost income will have a significant impact on your family after your death. Experts often advise that a family will need about 75 percent of the after-tax income you would have made to maintain their standard of living.
- Emergency cash: Life insurance proceeds can allow your family to set up an emergency fund that would protect them in the event of unexpected emergencies.
- Mortgage payments: Some people set up life insurance policies to be the same amount as their mortgage so the full cost of the mortgage could be covered upon death.
If you’re in need of advice about the amount of life insurance you should purchase, this is a conversation you can have with a trusted estate planning attorney in Tampa, FL. Contact the legal team at BaumannKangas Estate Law to schedule a consultation appointment.