William Penn Life, 2011 (46. évfolyam, 1-12. szám)
2011-03-01 / 3. szám
Moneywise INSURE U Get Smart About Insurance A 4-Part Series Presented by the National Association of Insurance Commissioners - www.insureoniine.org rvi se rv5 as ?! as % NJ rvj r^-5*5 3 Special Life Insurance Considerations for Established Families AS AN ESTABLISHED FAMILY, you may already have many of your basic insurance needs in place, such as life insurance and homeowners coverage. However, people at this age often begin to ignore their policies. As the value of your home and other assets increases, and as your children approach college age, your financial situation—including your insurance needs—will change. It is important to periodically review and update your coverage to reflect changes in your financial situation and family composition. One strategy to keep costs down for a growing family may be to take a look at term life insurance, which offers financial protection for a specified time period. For example, term life insurance is often appropriate to provide coverage during your childrearing years or while paying off a mortgage. You may want to consider this cost-effective way to protect your family while still putting money into other investments. Consider the future costs of your child's college education when determining how much life insurance you need at this life stage, and remember that permanent life insurance can help to complete a college savings program that is not fully funded. Another option you may want to consider is purchasing a combination of term life insurance and whole life insurance. If you are considering purchasing an annuity—a contract with an insurance company that promises to pay a series of income payments at regular intervals in return for premiums you have paid—explore the different types of options available: • Single premium • Multiple premium • Fixed • Deferred • Variable In addition, make sure you examine whether an annuity makes sense for you in terms of your income needs. Ask whether the annuity lets you tap into your principal if you should need it, or whether there are stiff penalty fees. Be sure you understand the fees associated with the annuity, as well as the special tax treatment of annuities, namely that income tax on annuities is deferred until you start receiving the income payments. And remember, whatever your age, a number of factors affect life insurance premiums, including: • The age you purchase your policy. The older you are, the more expensive the premiums. • Your overall health. • Pre-existing and/or chronic health problems may prevent you from getting life insurance or place you in a high-risk pool. • Poor health habits, such as smoking and excessive drinking. • Your driving record. The better your driving record, the better rates you'll receive for your life insurance. • Your geographic area. □ 6 0 March 2011 0 William Penn Life
