The Surprising Benefits of Life Insurance – Part One

Parents and children lying on rug and reading book in living room at homeLife insurance is one of those subjects that don’t often make it to the dinner table or family gatherings – that’s a given. It’s a topic that most people seldom want to discuss because of the associations people have with just the words “life insurance”: death, doom, gloom, who and what you’ll leave behind, and so on.

What you may be surprised to learn, is that life insurance can carry an entirely different meaning for you if spend the time to understand what it can offer you and the people you care for most.

How can having life insurance be a good thing? Follow along below; you may be surprised to discover that life insurance can be extremely useful in a number of ways you may not have not otherwise known about if you weren’t reading this article!

1. You’ll be able to live with the reassurance that your spouse and/or children will have financial assistance

It’s not uncommon for many people to procrastinate when it comes to signing up for a life insurance policy. Not only is the reality of every individual’s mortality a subject that most people don’t want to confront, never mind dwell on long enough to take the initiative in signing up for a policy, it’s also something that many people don’t think they need due to their age or current health.

As many of us are aware, however, at any point in our lives our time on earth could end or be cut short. When a sudden illness or death occurs, the spouses and children of those who pass on bear the brunt of what’s left behind, often left with several loose ends to tie up, some of the most significant being financial. With funeral and medical costs, incurred debt, a loss of income and other stressors, death can leave our families overwhelmed with added responsibilities.

Having life insurance before anything were to happen is a crucial safeguard to preventing additional trauma for your family, and at the end of the day, won’t you sleep better at night knowing your loved ones are taken care of? Most current policyholders would likely say that they do.

2. If and when you need long-term care, life insurance can help with the cost

Unfortunately, long-term care policies are quite expensive, which would be why many people procrastinate when it comes to signing up for it. Whether you find your self in a debilitating situation requiring long-term care (such as a car accident, or chronic disease) or are elderly, there may come a time when you need assistance with even the most basic of tasks, such as bathing, dressing, or cooking.

Purchasing a policy is important when you consider in the scenario that you need long-term care, one of the benefits of life insurance is that you can add a rider to your life insurance policy to help with the expense.

In doing so, your death benefit would be reduced, but it is a great safety net for those who would want long-term care insurance in the event that they would ever need it, as opposed to paying for both a life insurance policy and a long-term care policy.

It should also be noted that depending upon the policy you select, you may also be eligible to receive “living benefits” should you become terminally ill, allowing you to get a portion of your death benefit early with a life expectancy of 12 months or less.

If you’re over the age of 65, you should definitely consider this option to safeguard against drawing from your savings meant to support you after leaving the workforce – having a happy retirement is dependent upon being able to take care of yourself without the fear of struggling!

3. You can turn your life insurance policy into an investment

Yes, you heard right! A variety of life insurance comes with a cash value account that may pay dividends. In some plans, performance may be based on a sub-account. A sub-account is similar to a mutual fund, except that it is only available within a variable life insurance policy. One of the biggest benefits of this type of life insurance policy, is that there are several different types, leaving you with a number of options to choose where you’d like to invest your money.

Essentially, you can contribute to this policy and let your money grow for years, and then withdraw tax-free when needed so long as the account is used as a collateral. Keep in mind, however, that taking from your life insurance policy will reduce your death benefit, and without replenishing it could leave your loved ones between a rock and a hard place.

4. Those with a disability can waive their premiums

Did you know that if you have a disability your premiums can be waived? While the rider must be added at the time you select your policy and can make your payments more expensive, it’s a useful contingency add-on in the event that you should ever become totally disabled, upon which, your policy would remain in effect until the end of its term. While some conditions do apply, this added benefit of having life insurance could be a crucial asset in a time when you might need it most.

Surprised there’s so much good to be had with a life insurance policy? You may be shocked that there’s even more than life insurance can do for you…stay tuned for part two by subscribing to our blog, or visiting AmeriLife on Facebook when clicking the buttons below!

Check out one of our other interesting articles, such as 21 Ways to Save Money on Retirement Expenses!