What life insurance is right for me?

 

If you love someone who depends on your income, you need life insurance. Having the right plan in place means that you can sleep at night knowing that if something were to happen, your family would be able to maintain the lifestyle you have worked hard to provide for them.

 

If you have children, or are planning to, a question you should ask yourself is; do I want to provide money for my child’s education? If the answer is yes, this is something that should be looked at with your advisor in determining the appropriate amount of coverage needed. 

 

It can be a confusing topic in deciding what life insurance plan is right for your current situation. It is our job to inform you on the different types of life insurance and the advantages and disadvantages of each type.

 

Life Insurance can be broken down into two main categories. Term Life Insurance and Permanent Life Insurance.

 

Term Life Insurance

 

If you have a mortgage, have children or have any debts to pay off, term insurance is for you. Term life insurance is there to provide protection for a fixed number of years to provide financial protection to your family if you pass away prematurely.

 

Term life insurance is more affordable than permanent life insurance and is there to cover temporary insurance needs. By the time your mortgage is paid off, it no longer becomes a debt that you need to concern yourself with, thus you will no longer need to cover the mortgage amount in life insurance. Once your children are adults and can provide for themselves, they would no longer need your income to support them, eliminating the need to protect your income which provides for them.  You can get a term policy for 10 years, 20 years and even 30 years. The premium (amount you pay per month or year) will remain the same for the length of the term. After the term is up, you can decide to renew the term, reduce the amount of coverage or cancel the policy. 

 

Permanent Life Insurance 

 

Permanent Life Insurance is there to cover final expenses and any tax liabilities that would arise from the transfer of an estate. If you own a secondary property (eg cottage or vacation home) or a business that you would like to leave to a family member, it is important to consider whether or not your heirs would be able to afford to pay those taxes themselves. If that isn’t the case, they won’t be able to keep what you intended to leave them. Permanent life insurance can cover the costs of these taxes and make sure your property stays in the family.

 

 You can also use the cash values of permanent life insurance during the life of the policy, acting as a vehicle to save money on a tax deferred basis. Many clients supplement their children’s education fund by using this strategy. We strongly advise in having the appropriate amount of coverage as a priority first however.

 

You can purchase limited pay options and can pay the policy off in as little as 10 years. The value of the policy continues to grow throughout the life of the policy, as well as the cash values. 

 

Contact us for more information.