Yet, as we will discuss, life insurance is an affordable way to provide for your loved ones should you pass away. It’s morbid and not something we want to think about, but with carefully planning and choosing the correct types of life insurance policies, it will be one of the wisest steps you take in your financial planning.

Purchasing life insurance is wise for many reasons. Here are a few:

Pays off debt: Your spouse may be responsible for your mortgage and car loans. If they are unable to pay them, the cars and home may be repossessed. Life insurance payouts give the spouse funds to possibly pay off the mortgage and car notes, or at least, get them ahead until they can assess their financial situation.

Replace lost income: This is one of the main advantages of having life insurance. The surviving spouse is not left out in the cold as the insurance payout replaces their late spouse’s income. Financial security is one of the best legacies you can leave to your loved one. Make sure you have adequate coverage.

Builds up Cash Value: There are, of course, different life insurance products. Whole Life is permanent coverage which builds up cash value over many decades but can also be more expensive. You can also borrow from it for family emergencies. Term Life is coverage at a fixed payment rate for a limited period of time. When the policy expires, the cost of the premium increases. The policy owner may choose to continue coverage at the higher premium rate, cancel the policy or purchase other life insurance coverage. 

Estate Taxes: Heirs to an estate may have to pay inheritance taxes or legal expenses. Inheritances are taxed up to 10%, and estates worth more than $5 million are taxed at a 0.8-16% rate. *** A life insurance policy can cover those costs. 

Burial Expenses: Funeral expenses in Maryland average $9,921. Inheritances are taxed up to 10%, and estates worth more than $5 million are taxed at a 0.8-16% rate. *** Pre-paying for the funeral may ensure that the service is in place for family. Life insurance, also, gives your loved ones a guarantee, so there are no costs for your funeral and burial. 

Security: Most of us do not know when we are going to die. Life insurance provides funds for your family for any situation. You will have peace of mind knowing that your family has that protection in place. 

Life insurance is not for the living. It’s for your family and loved ones who will be forever grateful that you did not leave them out in the financial cold when tragedy occurs. The cost of it may seem high but the peace of mind is priceless. 

If you are interested in learning more about the different life insurance coverages and how they would benefit your family, call Lindquist Insurance at (301) 694-0008. 

*** For more about funeral expenses, visit the Go Banking Rates website.