- Term Life Insurance For Family Protection.
If you have a
family
you need sufficient life insurance to protect your spouse and children at least until the children are able to fend for themselves. If your estate is not too large that together with last expenses like attorneys fees, probate costs and the actual cost of the funeral are just about the only things you really have to concern yourself about. One more thing...if you have any uninsured debts you need to take care of those as well...
If on the other hand you have been very successful with your career or with investments you would need to think about
Estate Taxes
in addition to the aforementioned needs for life insurance.
5 year level term
is probably the cheapest term life insurance policy that you could buy to take care of those needs but you would probably find that the life of the policy is too short. May be the
10 year term
would be the cheapest term life insurance policy that could be applied to your need. Of course that would depend on the ages of your children...
You have to figure out how long they would need to depend on you. The
15 year term
probably would work but most people think it best to use the
20 year term
policy or may be the
25 year level term
policy to be on the safe side. The shorter the life of the policy the lower the premium...so the cheapest term life insurance policies are the 5 year term and the 10 year term policies...
These may not work for you though if your situation is similar to our example. If you are short of cash and you need to start off with either of these that is fine but you may need to convert to a
permanent policy
later on when you have more available cash or buy a new policy...if you are still in good health.
- The Business Persons Point Of View.
The business person tends to look at things in a little different way. They look for the cheapest term life insurance policy initially knowing full well that they will need to convert the policy to a permanent policy later on. Initially they need every bit of cash that they can put their hands on to build the business whether it be a sole proprietorship, a partnership or a corporation...
They intend to be in business for a long time and they would like to know that their heirs can continue the business after they die. If the family is not interested business people want to still be assured that the family wont be in need. They may consider the 10 year term policy the cheapest term life insurance policy for their need but some business people prefer to go ahead and use the 20 year term policy to start. The 20 year term policy may not be the cheapest term life insurance policy they can buy but this is the most popular one.
The following links will lead to pages that will give you details of life insurance needs for business people.
The Sole Proprietorship.
The Business Partnership.
The S Corporation.
The C Corporation.
The Limited Liability Company.
- Short Term Needs.
A policy that you would buy for short term needs is really cheaper than one that you plan to keep for a while. Let us suppose that you have a short term loan, may be for 5 years, and you don't want someone else saddled with these payments if you should die in the interim you could use a 5 year term policy to take care of that problem but a
yearly renewable term
policy may work out to be the cheapest term life insurance policy in this type of situation. This policy could also be used to guarantee the payments of college costs for a child or grand about to enter college or who has already started his or her higher education.
- Mortgage Protection.
Some people prefer to buy a special policy to protect their mortgage in the event of their premature death. The cheapest term life insurance policy for this need is the
decreasing term policy.
The face amount of the policy decreases as the mortgage decreases.
