It’s important to review your life insurance policy on a regular basis, just like you would any other type of insurance policy. You want to make sure that the coverage still meets your needs and that you are getting the best possible rate. In this guide, we will discuss when it’s time for a life insurance check-up and what you should look for during that review.
You Are Having A Baby
When a little one arrives, it’s usually an indication that it’s time to review your life insurance policy. Because this bundle of joy is most likely the birth of a new dependant, your life insurance policy will need to be updated.
You Are Getting Married Or Divorced
If you are just married or divorced, it’s likely that you’ll want to look over your policy. You may be sharing money when you get married. It’s a good idea to double-check your insurance coverage if you combine your money and start sharing accounts. A divorce is also likely to bring about a slew of financial adjustments.
- Update beneficiaries: Your spouse is usually the person you’ll want to be designated as your beneficiary, depending on your life insurance policy. If you get life insurance through employment, remember to update your beneficiary on that coverage as well.
- Update Retirement Plans: You can name a beneficiary who will inherit your retirement account in the case of your death if you set one up through an IRA, Roth IRA, workplace retirement plan such as your Pension, 401(k) or 403(b), and FSA and HSA Flexible spending accounts.
You Purchased A New Home
If you’re considering buying a house and taking out a mortgage, you should check your life insurance coverage. It may be one of the largest financial demands that you’ll face. For homeowners, purchasing a home might be one of the most significant financial decisions they make.
A mortgage is a large debt, and many mortgage lenders will want to make sure it is paid off if you pass away. If you die before paying off the loan, the obligation will be passed on to your heirs, and your spouse may not be able to afford the property on one income.
It’s possible that it’s time to make an adjustment or update your life insurance coverage after taking all of these factors into account.
Term life insurance: A term life insurance policy provides a death benefit if you die while the coverage is active. You pick the coverage amount and how long the policy should last. Term life insurance can be purchased by first-time homeowners to cover the duration of their mortgage.
Permanent life insurance: A permanent life insurance policy will last as long as the premium requirements are met. It may also grow cash value over time and is generally more expensive than term life insurance.
You Are Planning For Retirement
If you’re approaching retirement age but believe you don’t have enough money saved, maybe you’re looking into your alternatives. Life insurance may be a factor in your retirement plan consideration.
The basic goal of a life insurance policy is to provide your heirs with money when you die. You may be able to supplement your retirement income by using the cash value in your life insurance plan.
Life insurance is frequently out of sight, out of mind; you buy a policy and consider it done. Set aside the urge – check your life insurance coverage if you encounter any of these life events.
You Got A New Job
It’s also possible to review your life insurance plan and possibly update it when you change jobs. Whether there is an increase or a decrease in household income, changes can have an impact on living standards.
You’re The Breadwinner
If you are a primary caregiver for a loved one, review your life insurance policy to see if it is enough. If something happens to you and you leave a young child behind, your spouse might need to work full-time to pay the bills. This often means paying for child care. Additionally, if you are a caregiver for an elder relative without long-term care insurance you should consider how much money you are providing.
Your Health Is Improving
You may be able to obtain new life insurance rates if you’ve gotten healthier through exercise or made changes in your lifestyle that significantly affect your health.
For example, if you quit smoking or lose weight, your health may be impacted. Changes such as lowering blood pressure, giving up tobacco, or undergoing surgery to reduce weight or correct medical issues are examples of modifications that might have an effect on your health. If you encounter any of the following changes, you should consider purchasing additional insurance coverage.
Need Help Getting Life Insurance Coverage?
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