Why Should I Buy Term Insurance?
Life insurance is one of the most commonly used financial planning tools. A life insurance policy is an agreed upon sum of money to paid out to a recipient when you die. Life insurance policies are divided into several forms. One of the most common forms of life insurance is term life insurance, which is a policy that is bought for a set period of time. Once the fees for the policy are paid the purchaser accrues no additional benefits other than payment to survivors upon the policy holder's death.
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Provide For Family
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Term life insurance is a way to provide benefits for any surviving family members once you have passed away. A typical period will cover you once you start working and be in effect until you retire. Family members can use the funds in place of your missing salary. Life insurance benefits are not taxed.
Funeral Costs
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Most people who pass away incur what are termed final expenses. They include the cost of a coffin, funeral plot, rental hall, clergy fees and food served at the deceased's wake. These costs can easily run several thousands of dollars. Term life insurance can help pay for your final costs without causing undue hardship to any surviving members of your family.
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Low Cost
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A term life insurance policy is usually one of the least expensive forms of life insurance available. Policyholders can expect to pay between $1 and $10 per $1,000 worth of coverage purchased. According to beyondquotes.com a typical male non-smoker in his mid-20s can expect to pay about $400 annually for a $500,000 30-year policy. This can be favorably compared with more expensive forms of life insurance coverage such as whole life insurance, which might cost a 20-year-old non-smoker between $2,500 and $3,500 per year for a $750,000 policy, according to secureinsurancequotes.com. A whole life insurance policy is a policy that the policyholder pays for for his entire life and it accumulates value that can be tapped into in times of financial need.
No Dependents
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If you are single or part of a couple where your spouse works and earns enough to support himself in the event of your death, a term life insurance policy may be an ideal choice. The term life insurance policy is an inexpensive way of covering any minimal expenses you may have once you die at very low cost.
Work Benefits
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Employers often offer employees term life insurance for many reasons, including the fact that there are tax benefits for employers. A term life insurance policy through your workplace can be an ideal way to hold just enough coverage to meet any minimal life insurance that you may need.
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