13.8.20

Why It's Important To Protect Your Family For The Future


When you have children, the importance of protecting them is paramount. You walk outdoors and hold their hand so they don't run near the road. You put parental controls online so they cannot see anything untoward. You give them lifts, and ring them every half hour when they get older, so you know they're okay. Us parents do everything we can to protect our children, and that doesn't stop in the future either. 

One thought I had when I became a parent was, what would happen if anything was to happen to me, and I was no longer here to look after my child? And that's the time I looked into life insurance and realised just how important it can be, when it comes to having a family.

It's not about being pessimistic, but realistic. Taking out life insurance as a parent can help ensure your family will receive financial help if you're no longer around. 

What is life insurance?
Life insurance is a monthly contribution payment which designed to pay out a lump sum of money when you pass away. This money is then given to your beneficiaries - these are, the people you name in your will, your spouse, your family etc - to keep their life going along as usual without you around to help them. It's there to provide sustainability to their lives, so that the mortgage can still be paid, as well as the bills, any debts, whatever is needed. 

It allows them to go on living their life when you are no longer around to help financially. And if you're a couple, life insurance can either be taken out separately as a single life insurance policy or by a couple as a joint policy, there are pros and cons to each so it's best to look into which works for your situation. 

With the above in mind though, if you don't have any dependants, if you're a single person without children, or don't have a mortgage, then it might not be the best way to spend your money. Basically, there wouldn't be any big financial implications if you were to pass away, to put it bluntly, and so it might not be needed for you. 

How Much Cover Should I Get?
The life insurance cover amount you take out should be enough to cover what's left to pay on your mortgage, and then you should add extra cover for your partner and any other beneficiaries, such as your children, so that they are covered if they were to lose you, and your monetary contributions. 

The amount you choose is totally up to you, and your situation, but you could include cover for:  

Any household bills and day-to-day expenses
Any current or future schooling fees
Any money you've borrowed that you still need to pay back
Any extra money that would help your family if one of you couldn't be there

Why Should I Pay It?
This is a weird one, but I've seen a lot of people mention this before. Why should you pay an insurance, when you aren't going to benefit from it? I mean, you will have passed away for this to pay out, so I can see the point, but life insurance is about protecting your family in the future, rather than yourself. Imagine if you were to sadly pass away today. What bills would you leave behind? How much debt would be left on your family to pay back? Would you children be able to pay uni fees, bills, have a home to live in? 

That's why. To protect our families when we can no longer do it ourselves. And to be honest, our children are the most important thing to us, so it's just a way of being able to keep protecting them in the future. 

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