5 Reasons You May Need Life Insurance CPT Wealth Strategies

Life insurance is a fundamental and essential component in any comprehensive financial plan. It instills a sense of security in the policyholder and their dependents. Some may see it as unnecessary, but that is far from reality. The necessity of life insurance becomes evident when we consider why every adult needs to consider it.

Reason #1- Financial preservation.

One primary reason you should consider life insurance is that it offers financial preservation to your family and loved ones in your absence. If your family depends on your financial support for their livelihood, life insurance is indispensable because it replaces a portion of your income when you pass away. This is particularly crucial for parents of young children or adults who would find it hard to sustain their standard of living if they no longer had access to the income provided by their partner. You’ll want to ensure your family can live comfortably without financial stress.

Reason #2- Cover debt and other expenses.

Another reason life insurance is essential is to cover debt and other expenses. These might include mortgages, car loans, personal loans, private student loans, credit card debts, or other liabilities. A substantial life insurance policy can help ensure these costs are covered in your absence. This way, your dependents won’t be burdened with debt.

Reason #3- Cover funeral and burial costs.

Life insurance can also help to cover funeral and burial costs. The death of a loved one is a most unsettling and stressful time for any family. In addition, the high cost of a funeral and burial only compounds such distress. A decent life insurance policy could help cover these final expenses, so your loved ones won’t have to bear these costs during such a grieving period.

Reason #4- A strategy for inheritance planning.

Moreover, life insurance plays an instrumental role in inheritance planning. It can create an inheritance by naming your heirs as beneficiaries of your policy. This way, you can set your beneficiaries up for an independent financial future and provide for unexpected monetary needs after your death.

Reason #5- To benefit from the cash value.

Interestingly, life insurance can also be a powerful tool while alive. Specific life insurance policies have a cash value component that grows over time and can be borrowed tax-free. This cash value accumulation is another considerable advantage of insurance that can be used for wealth building and augmenting retirement income.  However, please note that access to cash values through borrowing or partial surrenders will reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.

In conclusion, life insurance is not just about paying out when you die. It’s about providing financial safety, security, and independence and helping to ensure e that your loved ones are financially cared for in your absence. It’s about leaving a legacy and helping the memories you’ve created with your family be cherished without the shadow of financial distress.

Indeed, life insurance is a vital safety net that every person should consider. Although its importance may not seem apparent now, the significance of such a tool can become clear at the most unexpected time. Therefore, purchasing life insurance can be one of the most crucial decisions you can make for yourself and your family.

 

 

Sources:
https://www.investopedia.com/articles/personal-finance/091014/who-needs-life-insurance-who-doesnt.asp 

This information is provided as general information and is not intended to be specific financial guidance. Before you make any decisions regarding your personal financial situation, you should consult a financial or tax professional to discuss your individual circumstances and objectives. The source used to prepare this material is believed to be true, accurate and reliable, but is not guaranteed. Guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.  This is not a comprehensive review of all features and benefits.  All the material details of his product should be reviewed prior to making a purchase decision. SWG3635756-0624

This article is educational purposes only and is not advice or a recommendation for any specific product, strategy, or service. The views and opinions expressed are those of Lone Beacon only.

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Written by Lone Beacon for Mike Robert's Use