Term Life Insurance Calculator
Making the decision to purchase life insurance is often an easy decision to make. After all, you only have to pause and think about how your loved ones would fare financially after your death to realize that you do have the need for life insurance. After all, after your death, your family would not have your income to provide them with money for everyday living expenses such as mortgage or rent and food. Your family may also require additional services after your death, such as the need for a nanny or regular babysitter, lawn maintenance service, cleaning service and more. You contribute to your family financially, but you also contribute in different ways that have monetary value as well. After you have decided to purchase life insurance, you next will have to determine how much life insurance you need to purchase and how much life insurance costs your family and can you afford it. By using a life insurance calculator, you can more easily determine how much coverage you need to buy.
Different Types of Calculators
By searching online for life insurance calculators, you will determine that there are several different calculators you may put to use. Some will be based on how much term life coverage you need. Term life coverage is generally purchased to supplement income, to pay off debts and to fund larger expenses that will need to be made over the 20 or 30 year term period. An example would be to fund a child's college education. Other calculators may be used to determine how much whole life insurance you need. Whole life insurance may be used for many of the same purposes that term life is used, but it can also be used as a source of loan funds, to fund retirement plans in the future and more. There are other life insurance calculators that will analyze all of your needs in order to help you find the best combination of both whole life and term life policies.
Review Your Finances First
Life insurance calculators can be very beneficial, but you will need to do some analysis of your finances on your own. You should first determine the level of death benefits needed to support your family after your death. Consider how using some of the benefits to pay off debts like a car loan or mortgage would affect your budget and needs for cash for monthly expenses. Consider the level of income a survivor will be able to contribute as well as the need for any additional expenses the family will need to take on as a result of your death. For example, even a stay-at-home parent who does not generate income will need coverage that can be used to pay for nanny services, cleaning services and more.
Consider Future Plans
Your finances should be reviewed with regards to immediate, monthly needs for income, and they should also be reviewed with regards to future plans. For example, the death of a loved one with a full-time job may affect the retirement plans a couple has developed. Perhaps the income of two parents is necessary to put the kids through college, but the loss of one of the parents could affect those plans. In order to purchase ample coverage, consider what your long-term financial plans are and how coverage can be used to strategically plan for the future.
Reconciling Your Analysis
Many people will perform their own analysis of their finances to determine their need for coverage, but many will have that nagging fear in the back of their mind that it is not enough. The fact is that after death, you cannot purchase additional coverage. So you do need to take time to fully analyze your finances and ensure that you purchase all of the coverage your need today. You can compare your own analysis today with the results you receive from using life insurance calculators. Each calculator you use may provide you with a slightly different result, but you should find comfort with your own analysis if the online life insurance calculators correspond with your numbers.
Shopping for Rates
After you have determined how much coverage you need to buy and have determined whether you want to buy whole life, term life or a combination of both, your next task will be to shop for insurance rates. Keep in mind that insurance rates will generally increase as you age. With this in mind, the most affordable time to buy life insurance for most people is now. You can lock in rates today at your currently young age, and you can enjoy a fixed rate for your coverage as long as your policy remains in effect.
Life insurance is
something you need to have in place today. Death is something that unfortunately
occurs when least expected. The loss of a loved one can be traumatic,
and this loss can be exasperated by financial worries. By purchasing insurance
today, you can provide for your loved ones financially after your death
and allow them to mourn without the added grief of financial woes.