The primary purposes of life insurance is to ensure that surviving beneficiaries will have an income sufficient to meet their needs.
Ask yourself three questions:
- If you died tomorrow, how much money would you want to provide your family, after taxes, on a monthly basis?
- How many years would you want to provide this monthly income?
- What is a reasonable rate of return on your money?
Example: Your beneficiaries will need an after-tax income of $2,000 per month over a period of 20 years. How much insurance should you buy?
If your survivor’s tax rate will be 28% and the proceeds of the life insurance policy can be invested to yield 7%, compounded daily, you’ll need $156 of principal for each $1 per month of after-tax income. Therefore, you will need 200 x 156 = $312,000 of Life Insurance.
Keep in mind there are many different types of life insurance. The best kind of life insurance is the kind that is in force when you die.
Life insurance has never been more affordable than it is today.
Call us for your personalized comparison. We hope the worst won’t happen, but sometimes it does. Leave a legacy of love and financial security – make getting life insurance a priority.