Valentine’s Day: Something for Your Beloved

by Susan Paige on February 6, 2018 · 0 comments

With Valentine’s Day fast approaching, have you gotten your loved one that special gift? Maybe it’s chocolates, a bouquet of roses, or that one piece of jewelry they’ve been eyeing for months.

No matter what you decide to buy your partner on Valentine’s Day, it should be something that comes from the heart that shows much you value and appreciate them.

But you don’t necessarily need to buy the usual gifts to show someone how much you care. There are other ways to give an important present on Valentine’s Day—we’re talking about the gift of life insurance.

Why Give Life Insurance?

What better way to show someone how much you love them than by giving them financial protection? Life insurance helps cover the costs of the funeral if you were to pass away unexpectedly and can provide financial support after you’re gone.

Depending on the type of policy you buy, the beneficiary of your life insurance policy may receive money to continue paying bills and living the lifestyle you’ve built together. You work hard to provide a stable life for your loved ones, so why not help them maintain that life, no matter what happens?

If you were to pass suddenly, do you have outstanding debts that still need to be paid? By having life insurance, your significant other would potentially not have to bear the financial burden of remaining debt while they are grieving. They can have access to money that may help cover costs like mortgages, credit card debts, or student loans.

Your life insurance can also be seen as a gift of time. By taking care of debt and covering funeral expenses, you are giving your loved one the necessary time to grieve your loss without added financial stress.

How Do I Do This?

First things first, it is important to find a reputable life insurance company with a steady third-party rating.

Life insurers receive ratings from multiple companies that specifically focus on rating insurers’ ability to meet their financial obligations. Look for a company that is strong, stable, and reliably receiving A+ ratings over time.

You must then decide which life insurance policy best suits you and your family’s needs without breaking the bank. There are two common forms of life insurance: term insurance and permanent insurance.

Term life insurance is what it sounds like: you pay premiums for a set term (usually 10, 20, or 30 years). After that, the coverage either expires or you can renew it. This policy tends to be the most affordable.

Permanent life insurance is a policy that is meant to cover you for your entire life. The premiums can be more expensive since the policy has a higher chance of being paid out. Permanent insurance also has a component that provides the potential to build cash value, which can be utilized through policy loans or withdrawals.

Work with a financial professional to establish the best policy for you. There are important differences between policies, and you’ll want to choose based on factors including your family size, your age, and more.

Think of the gift of life insurance as a way to take care of the one you love even when you’re no longer there. This type of Valentine’s Day gift lasts much longer than one day in February, and it will show your special someone that you want to love and cherish them forever.

Income and growth on accumulated cash values is generally taxable only upon withdrawal. Adverse tax consequences may result if withdrawals exceed premiums paid into the policy.  Withdrawals or surrenders made during a Surrender Charge period will be subject to surrender charges and may reduce the ultimate death benefit and cash value.  Surrender charges vary by product, issue age, sex, underwriting class, and policy year.

The net cost of a variable interest rate loan could be negative if the credits earned are greater than the interest charged.  The net cost of the loan could also be larger than under standard policy loans if the amount credited is less than the interest charged. In the extreme example, the amount credited could be zero and the net cost of the loan would equal the maximum interest rate charged on variable interest loans.  In brief, Variable Interest Rate Loans have more uncertainty than Standard Policy Loans in both the interest rate charged and the interest rate credited.

 

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