Yes, People Search Life Insurance Calculators
If you have been online for some time, seeking life insurance, your eyes should haven’t escaped the phrase ‘life insurance calculator.’
You may have chanced upon the phrase. But, many look for it.
Here are statistics showing how many prospective U.S. buyers look for life insurance calculators a month:
Life insurance calculator: Up to 10,000
Insurance calculator: Up to 10,000
Term life insurance calculator: Up to 10,000
Whole life insurance calculator: Up to 10,000
Term insurance calculator: Up to 1,000
Term insurance premium calculator: Up to 100
Life insurance cost calculator: Up to 10,000
Besides, there are searches for ‘life insurance cost calculators.’
So, what are life insurance calculators? And what worth are they?
When you are up for taking out life insurance, one of the fundamental questions, that you should find answers to, is: How much life insurance do I need?
This seemingly easy question can be the hardest nut for you to crack. Easier really asked than answered.
But finding the right answer is inevitable.
During purchase an insurance policy you actually buy assurance of a lump sum of money from the insurer. The insurer will pay the money to your heirs when you die.
You call it coverage, face value, proceeds or death benefit.
The future security of your dependents depends largely on the coverage you choose.
As a result, you cannot be a random chooser. If you choose more than what your heirs would need, you apparently don’t make any mistake. But unless you choose your life insurance to work as a savings tool (through whole life insurance), chances are your money spent for insurance will be wasted. It will happen so because term insurance policies (which most people buy) scarcely convert. Most people outlive their terms and get nothing in the end.
On the other hand, if you choose less than what your dependents would require for financial safety, they will have trouble living the life behind you.
Not surprisingly, many people randomly choose a gross figure without doing proper life insurance calculations. As a result, they either over-insure or under-insure themselves.
This is why, life insurers have come up with Do-It-Yourself (DIY) tools, so that, instead of randomly choosing a lump sum, you may go methodically at your coverage.
With the help of digital technology, they have made life insurance calculators to help you find the right coverage.
It is wise that you make use of these tools.
Statistics about Coverage Gap
Many make the mistake of buying less coverage than they should. As a result, their dependents’ future remain uncertain.
Life Insurance Market Research Association (LIMRA) estimated in 2016 that 48% of the U.S. families had an average life insurance coverage gap of $200,000. The number of such families was 60 million and the economic value was worth $12 trillion. The estimate also says, while income replacement in 2010 was for 3.5 years, it decreased to 3 years in 2016.
That can be good news, neither personally, nor nationally.
Unless you are willing to keep your family under-insured, you need to know how much life insurance you need. This is where you need to think of using life insurance calculator.
How Does the Life Insurance Calculator Work?
You will find numerous life insurance calculators online. Any one of them can be of great help when you cannot decide how much life insurance you need. Not much hypothetically speaking, these DIY tools have almost replaced financial experts when it comes to fixing your life insurance need.
These life insurance calculators are question-based. All you need to do is put in the estimates that you think your dependents will need behind your death. The tool brings up the sum and you choose it for your life insurance coverage.
It is that simple!
But remember, not all life insurance calculators work the same way.
The Uses of Life Insurance Calculators
There are real reasons you may find life insurance calculator to be cool.
First, life insurance calculators are free. Like we said there are numerous life insurance calculators you will find online. A big advantage of these tools is they come free of cost.
Secondly, you can make use of more than one or as many calculators as you want to. Though almost all of them work the similar way, they are not absolutely the same everywhere. So, they provide you the opportunity to check and double-check the coverage you should choose.
Thirdly, being well-planned and programmed, online life insurance calculators are faultless. They are designed by experts in the industry.
Fourthly, you can get your calculation at ease from the comforts of your home or office. You can choose the time and place the way you find it best.
Fifthly, when you use a life insurance cost calculator, you do not need to share any personal information with anybody. This impersonality is a great feature of these tools.
Sixthly, online life insurance calculators are obligation-free. Making use of the tool does not oblige you to purchase a product.
Seventhly, the providers of life insurance calculators often provide the essential discussions to educate you. There are tips and guidelines to help you make the right decision.
Best Life Insurance Calculators
You already know not all life insurance calculators work the same way. Some of them are minimalist while some are maximalist. Life Insurance Mentors team has picked the best online life insurance cost calculators for you:
According to our analysis, Edward Jones ’ tool is the No. 1 life insurance calculator. They consider your life insurance need not only most comprehensively, but also provide you guidance where necessary.
Their tool covers the widest possible financial issues that you should take into consideration while making your estimate.
Edward Jones’ tool covers all the possible financial liabilities that you may have. As a result, you are less likely to make any mistake in your calculations.
The data you are asked for are:
Real state payment
Legacy Issue/Charity Issue
Assets to belong to your family through investment
Current life insurance
State and federal income tax rate
Return of premium
Next to Edward Jones, Lifehappens’ calculator came out to be the second best. They also make use of a wide range of data to prepare your life insurance need.
You put in the following data and get your estimate easily and instantly:
Estimated final expenses
Outstanding debt other than mortgage
Current savings exclusive of retirement funds
Already purchased life coverage amount (if any)
Desired income replacement
Current retirement savings
Estimated expenses if spouse continues to work after your death.
Spouse’s annual income
Spouse’s marginal tax rate
Expected duration of spouse’s work
Estimated inflation rate
After-tax investment yield
Thus, there being all the essentials of financially important issues asked, you probably can make sure you will have the coverage you should. They also provide essential tips so that you walk along the right track.
Inclusion of some criteria that others do not cover makes Financial Mentor’s (Life Insurance Mentors, is by no means, related to or affiliated with them) calculator one of the best. They are also recommendable for their easy and simple method of calculation. Even if you do not have much knowledge about finance, you can calculate your coverage easily by using their tool.
They ask you about estimated:
Funeral costs and estate taxes
Amount needed for emergency fund
Amount needed for college fund
Estimated annual living expenses
Surviving spouse’s after-tax annual income
Social Security death benefit estimate
Surviving spouse’s current age
Total current investment
Expected survivor’s investment strategy
Bank Rate has the simplest of all the life insurance calculators.
The data you need to put in are:
Estimated burial expenses
Years of income to cover
Net annual income survivors will need
Amount in current savings and investment
Life Insurance Mentors Team’s Advice
You should have noticed that all the life insurance calculators do not work the same way. While some deal with the very basic issues, some others go into wider ranges. So, depending on one particular calculator might not be the best decision for you. Life insurance being an important issue, you need to look at each and every spectrum of it. This is why we ask you to make use of several life insurance calculators.
And, when it comes to income tax, you had better consult a financial expert for the coverage.
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