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Life insurance can sometimes be confusing. If you already have it, you may be wondering if you have enough. If you don't have it yet, what type do you need? This guide can help you get started.
To get a quick estimate, seven to 10 times your salary may be a good start. However, if you want a more personalized estimate based on your situation, use our life insurance calculator or "L-I-F-E," as a guide to calculate your:
If you also want to use the insurance to leave money to your heirs or charity, add that amount to your LIFE estimate.
There are two types of life insurance: term and permanent. How you choose between them depends on your goals, how long you'll need the insurance and how much you want to spend.
Term insurance is generally used to cover a specific time frame versus a lifetime need. It's also typically the most affordable type of life insurance, making it a great choice if you still have kids at home and you're paying a mortgage. When the initial term period is up, you may be able to continue the policy, but premiums could rise.
Permanent insurance covers your entire lifetime and can be used for a number of goals, offering greater flexibility, but it is also more expensive than term insurance. You may be able to use permanent insurance to ensure you leave a specific amount of money to heirs or a charity, regardless of how long you live. Some policies also offer flexibility to use the death benefit for long-term care expenses, if needed. Many permanent insurance policies also allow you to build cash value within the policy.
|Death benefits pass to beneficiary free of federal income taxes
||Death benefits pass to beneficiary free of federal income taxes
|Premiums are generally more affordable but can rise with age if you need to continue the policy past the initial term||Premiums are usually level, don't increase with age|
|Generally used to cover a specific timeframe (such as 10 or 20 years)||Offers lifetime protection|
|No cash value
||May have cash value, which could grow over time, tax deferred|
|May offer flexibility to be used for other needs, such as covering long-term care expenses|
Life insurance needs can change over time and the coverage you have today may not be what you need tomorrow, so it's important to discuss your options with your Edward Jones financial advisor. He or she can look at your entire financial picture and help you choose and purchase a life insurance policy that meets your needs.
Edward Jones is a licensed insurance producer in all states and Washington, D.C., through Edward D. Jones & Co., L.P., and in California, New Mexico and Massachusetts through Edward Jones Insurance Agency of California, L.L.C.; Edward Jones Insurance Agency of New Mexico, L.L.C.; and Edward Jones Insurance Agency of Massachusetts, L.L.C.
All your life you've worked hard to provide for your family and the causes that are important to you. With a little planning, you can continue that tradition of caring after you're gone. Learn how life insurance could be the key to helping you achieve your legacy goals, particularly if you have specific wishes about leaving money or property to your heirs or charity.