The Myths About Life Insurance
In today’s era of instant data and information bombardment – particularly via social media and smart devices – it is easy to get overwhelmed with all the material available at our fingertips. Given this kind of environment, it is understandable that there are many myths and misconceptions associated with life insurance.
For instance, though there are tax-advantages to using the right insurance strategies, it is important to not fall into the trap of thinking of insurance as solely a tax-saving tool. Those that only view insurance as a tax-grab usually don’t get enough coverage to protect themselves and their families. We encourage anyone seeking to make an informed decision to talk with a professional in order to demystify the common misunderstanding of the tax-saving element included in certain policy strategies. Remember, the core objective of a policy is to provide protection to you and your family, and to build an assured safeguard for future needs.
“Everyone needs insurance. Unfortunate accidents and illnesses happen every day.”
The most unfortunate myth about life insurance is that it will only benefit those that are insured after their passing. Though term policies and other short-term alternatives only offer benefits after one’s passing, it is important to remember that term insurance does not represent all the various types of policies available. Yes, one of the main objectives of taking insurance – particularly in this case - is to provide a financial safety net, in the event of unforeseen circumstances. There are, however, policies that include investment strategies and tax-free retirement income (via an interest-capitalizing investment secured by a life policy). (Related: One Lifetime, Six Major Expenses)
Another common misconception is that group insurance is adequate for one’s individual life situation. Indeed, group insurance might be adequate for a select few, but for most of the population, group insurance does not cover enough for their personal living expenses (mortgage, car loans, and miscellaneous liabilities). Furthermore, though some group coverage options can be converted into an individual policy (within a given time frame) the benefits are usually standard and may not apply to all personal situations. (Related: Invisible Essentials)
Alternatively, there are often those that believe they are too healthy to get life insurance (particularly critical illness). Though being healthy is a blessing and offers us longer and more enjoyable lives, good health does not negate getting ill. On a positive side, good health does offer preferred rates for those who qualify. Moreover, those who live longer because of their good health tend to accrue more from their investments – over time. In conclusion, everyone needs insurance. Unfortunate accidents and illnesses happen every day, regardless of our health. Better to be safe than sorry. (Related: The Taboo “F” Word)
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