- Types of Life Insurance Policies
- How Much Coverage Do I Need?
- Budgeting for Your Policy
- Naming Beneficiaries
- Special Features
- Where You Can Buy Life Insurance
- Evaluating a Potential Agent
- Questions to Ask About a Policy
- Before You Switch Policies
- Using Life Insurance as an Asset
Budgeting for Your Policy
Once you have an idea of how much life insurance would be optimal to carry, you’ll need to decide if you can realistically afford to budget the premium cost for that policy out of your existing income. In other words, “How much do I need to budget out of my current income to be able to afford the premium for the coverage I want?”
The insurance professional you are working with should provide you with a clear breakdown of how much the policy will cost you and when your payments will be due. Click here to learn more about how to budget your finances, including life insurance payments, to keep your financial life running smoothly.
While you probably want to provide adequate coverage for your family, it is important to buy a policy you can afford. If you end up not being able to pay the premium, then you will have no coverage.
Review your policy periodically to determine if it still meets your insurance needs as your life changes. For example, if you purchase a policy while you are single, you will want to consider if the coverage is still adequate when you get married. Likewise when/if you start a family. Many professionals recommend reviewing your life insurance needs at least every five years or whenever you have a major change in life circumstances.