Something that becomes more and more of a concern as we grow older is just how our family and loved ones will be able to cope without us.
Of course, age isn’t the only factor that can cause our unruly demise; there are far too many factors to mention here. Suffice to say, a vast number of people decide to opt for life insurance in hopes of protecting their families in unforeseen circumstances.
Although, there’s a lot of common misconceptions out there about just how much life insurance you should carry, and that’s exactly what we will be discussing in this article.
In this article, we will be covering all the variables you need to consider when wondering about how much life insurance you should be carrying, as well as some other important tips you need to know.
Responsibilities & Family
The amount of life insurance you should be carrying is completely dependent on your individual circumstances.
For those of you who have families, an extensive coverage plan for life insurance is a must. This is because of the obvious implications that arise when having a family such as financial struggles as the emotional toil your family will face on top of that.
The larger your family, the more coverage you will need. For example, someone who has 4 young children and a wife will need almost ten times the coverage that a single person without a family would require.
If you don’t opt to go for an extensive coverage plan when you have a family, you are not taking all the possible steps you can to ensure their livelihood in the future.
calculating how much insurance you need in specific, can be quite a troublesome task. Although, there are plenty of resources out there that can help you get an idea of what would be best for you.
Do You Have a lot Of Debt?
If you happen to have a lot of unpaid debts, then it is vital you opt for an extensive coverage plan in order to not leave that burden resting on the heads of your loved ones.
Many people hold the belief that they should avoid getting life insurance if they have debt and instead focusing on paying their debts. However, this is not the right course of action at all.
Of course, you should aim towards paying any and all debts you may have, but it’s essential that you get life insurance alongside your venture to avoid giving a burden to your loved ones.
Children or Childless?
Similar to our first point we mentioned, the number of children you have can be a massive influence on just how much life insurance you should be carrying.
Although things can start to become a little complicated once children are involved, there are a plethora of other factors you need to think about.
For example, if you have multiple children you will have to choose only one child to be your life insurance beneficiary, and depending on the child you choose can drastically affect the amount of life insurance you need to carry.
Say you have an older child who is already wealthy and well-established in the world, then you may not have to carry as much life insurance as someone whose oldest child is still only a teenager or an adult who is struggling financially.
Furthermore, the choice of which child you will choose to be your beneficiary is one that carries a lot of weight, and can also change the amount of life insurance you need to carry.
If you have a child that is terrible with finances and is likely to waste any money they receive by making poor decisions, then you may want to consider carrying a smaller amount of life insurance since it more than likely won’t be used for good.
Although, there are still numerous reasons why you should own life insurance even if you are childless. Even for those of you that have no children, you still should carry some life insurance to cover the funeral costs and avoid putting that burden on your loved ones or friends.
Overall, the amount of life insurance you should carry completely varies from individual to individual.
If you are the sole provider for your family and currently have a lot of debt, then opting to get a pretty extensive coverage plan will be the best option for you in the hopes of securing your family’s future.
On the other hand, if you don’t have a very large family or people that are dependent on you, then you might not need to worry about getting the best plan out there.
The main takeaway from this whole article as well as the topic as a whole of how much life insurance one should carry, is that you should always go for the most coverage you can afford. Of course, there are exceptions to this rule when it comes to people who have no family, but even then, it’s a good thing to carry a reasonable amount of life insurance to ensure your funeral and death costs don’t become a burden to someone else.
Don’t underestimate just how much death and funeral costs can amount to. It’s certainly not something to overlook.
In the end, just do what is best for you and your circumstances.