No one wants to think about his or her own mortality. But, if you have loved ones depending on you for financial support, you should consider the impact if you were to pass away suddenly. Life insurance is designed to help soften the financial blow to your dependents if the unthinkable happens.
Term insurance is used to meet immediate expenses like short-term debt obligations.
Term insurance only provides protection for an established period of time or until a certain age. If you die within this period, your beneficiaries receive the insurance proceeds. However, if at the end of the term you are still alive, the policy terminates and the protection ceases.
Term policies offer renewable and convertible options, allowing you to convert to a permanent policy or to renew your term policy for a specified period of time.
Term insurance is generally priced so that it is more affordable while you are younger and is best suited for families with young children as a way to meet their ongoing financial obligations. It's an ideal way to offset the risk of a family losing one of its key income earners.
B. Kirk McNamee, CFP