When we talk about age, we usually talk about a specific number. But if we talk about life’s stages, the numbers don’t really seem to matter. Instead, it becomes the “at school stage,” the “single stage,” the “new house, young kids stage,” and so on.
Every life stage defines a chunk of time — time that differs for everyone.
In other words, people reach different life stages at different ages. So when you’re analyzing your insurance needs you need to consider your current life stage and the products that can meet the needs for this stage.
Term insurance
This can be the perfect choice for many life stages. Commonly known as temporary insurance because you pay premiums for a limited period of time and then the insurance expires. At younger ages, term insurance is less expensive than other kinds of insurance, so it is often used by people with young families. Term insurance can also be a good choice for mortgage or debt insurance. Some term insurance policies will allow you to convert your policy to permanent insurance without needing to provide more evidence of good health, this is typically allowed to age 75.
Permanent insurance
This is as the name suggests, permanent coverage that you own until death. The two kinds are permanent insurance available are whole life or universal life. Both these are good for many life stages, but are typically for people with more disposable income. With whole life insurance, you pay premiums for a certain period of time or for life. With some policies, you also have the ability to build up a cash value. A universal life insurance policy office a combination of insurance coverage and tax advantaged investing. The policy includes a variety of investment accounts and the earnings are not taxed as long as the money stays in the policy. You can purchase a universal life policy that meets your protection needs today and, as your needs change in the future, you can add features, benefits and investment accounts of another product.
Living benefits
This type of insurance includes three types being critical illness, long-term care and disability. Critical illness insurance pays you money if you become critically ill. This type of insurance is a valuable investment at any life stage, after all, the cost of recovering from an illness can affect everyone. Long-term care insurance provides you with the services and support you need to maintain your day-to-day activities if a chronic illness or cognitive impairment keeps you from being able to take care of yourself. While this insurance is most likely used by people in later life stages, the planning for it should begin early. Disability insurance is important for anyone who relies on working income. Supplementing your group coverage with an individually owned disability insurance policy can provide you with benefits that address your unique needs.
Whether you are single or married, you just start a family or you’re sending your first child off to university, you will want to ensure you’re property protected. Make sure you sit down with your advisor to determine the right life insurance and living benefits insurance coverage for your specific needs. Anything can happen. That’s why it’s important to get all the coverage you need to protect your lifestyle, your family and everything you worked hard to achieve.
Remember to always consult your advisor before taking any action.
Stuart Kirk is a Retirement Planning Specialist with Hicks Financial Inc. The opinions expressed are those of the author and may not necessarily reflect those of Hicks Financial Inc. For comments or questions Stuart can be reached at stuart@ghicks.com or 250-954-0247.
