Sorting through life insurance options can be overwhelming. It’s an essential purchase you want to get right. Since different types of life insurance offer various benefits, it can help to know some things that should be considered when choosing a life insurance policy.
How Long Will You Need a Life Insurance?
Choosing life insurance starts with deciding which type of policy you need. There are two primary types of life insurance: term life and permanent life. The length of time you need to be insured will determine the type you need.
Term life is ideal for people who only need insurance for a specific period, perhaps until the kids graduate from college. Term life policies are typically for 10 to 30 years. Permanent life provides lifetime coverage as long as premiums are paid.
How Much Life Insurance Coverage Do You Need?
Once you know the type of policy you need, you need to determine how much coverage to buy. You should consider your age, income, current expenses, and expected future expenses.
A few formulas can help determine precisely how much coverage you need. Your insurance agent can also walk you through everything you should consider to ensure your policy will be enough to take care of your family after you’re gone.