There’s an old adage that says that two things that are inevitable are death and taxes. Unfortunately, everyone dies. However, one thing you can do is to help your family transition through their grief by easing the potential stress of any financial burden they may have. One way to do this is to come up with a solid life insurance plan. There are several types of life insurance out there, so you need to determine which type will ultimately fit your needs.
What Life Insurance Covers
Life insurance provides funds for funeral expenses. The average funeral can begin at $10,000 dollars and quickly escalate. Some items that are included in funeral costs are securing a space for the service, casket and interment costs, or cremation costs, ministerial or eulogist services, plus any catering for repast services. With an adequate life insurance plan in place, many funeral homes allow loved ones to make plans without assuming any out of pocket expenses. Anything left after the funeral home expenses reverts to the beneficiary of the policy. It is important to note that while life insurance is considered income for your family after your death, it is non-taxable income.
Types of Life Insurance Plans
There are several options for plans.
- Term. Term life insurance provides a fixed period of time to gain full maturity and is one of the most common types of insurance offered and purchased. The time period can be a short as one year or as lengthy as 20 years.
- Universal. Universal life insurance is characterized by its flexible premiums and interest rate. Universal life insurance policies can build cash value over time.
- Whole. Whole life insurance endures for the life of the person as long as the premium payments are made. Like universal life insurance, the policies build over time, making them an investment.
Regardless of what type of life insurance plan you consider, you should consult with an insurance broker like the ones here to determine the level of coverage that is right for you. Visit us for more information. You can also follow them on Twitter for more updates.
