Yes, What Is the Need for Life Insurance for Spouses?
Whether there is any need of life insurance for spouses or not has been a dilemma for many. But it should not be. If man and wife are made for each other, they could at least have some thought over the issue.
We know saying so is too judgmental.
Let’s go find the reasons…
Life Insurance for Homemaker Spouse
They say you need life insurance on you if you are the breadwinner. And they are right. A family turns into a paddleless canoe when the breadwinner passes away. So, it is essential that average-income families have life insurance on their breadwinners.
But having life insurance for a spouse who is a homemaker could equally be important. Important in that while you have life insurance on yourself alone, it serves as a safeguard for the family. But when you have life insurance on both, the other spouse’s life insurance could prove to be a positive decision for good reasons. No surprise!
Listen to why…
It is sure one will die before the other (unless there is an accident). If you both have life insurance and the coverage is modestly high in amount, a big death benefit of one will come to the other and the beneficiaries. No matter who dies, the benefit will be helpful in the reshaping of the future, meeting the expenses that arise out of the death, paying funeral costs and medical bills, credit card loans and the like. The money received can also be used to facilitate the educational expenses of the deceased’s heirs.
The Flip Side
No doubt if both policies of the insurance for spouse is in the term category and both outlive the tenure, the money will finally prove to be a fool’s investment.
Accepting that you know life insurance is meant to be (kind of) for fear of unforeseen incidents, the decision could be worth it. If circumstances leave you to need it, you know how useful it can be. So, in place of protection of one, having protection for both could really be sensible.
You might think having two life insurance policies for both in place of one will double up the expenses. It surely will. But unlike what most people think of life insurance costs, it costs a lot less than it is imagined. Sometimes, it can be as little as your one evening’s Starbuck bills or even less.
What About Costs?
Supposedly, if you are in your mid-twenties and all fit, you can get a 30-years term insurance for as much as half a million dollars for about $32. That means together you will require to spend about $65 a month. So, over the span of the insurance you two spend $23,040. That means, each spend $11,520 in 30 years. Though, as some insurance people say nearly half of the couples’ partners die before 65, the fact is far from the truth. According to CDC (Center for Disease Control and Prevention), about 18% of the Americans die within the age range. Seen from this perspective, life insurance for both spouses is not a mistakenly taken decision for all. Who knows which group you or I belong to?
When You Both Earn
When both the spouses earn, having insurance on only either can be a bloomer. Death of one naturally cuts the flow of income to the family suddenly. As a matter of course, this is to affect the lifestyle of the survivors.
Besides, there might be dues, loans, mortgages etc. to pay back. The surviving spouse might find it difficult to bear the financial burden that the deceased might have left behind. Seen from this point of view, life insurance for spouses can be a decision you can surely go with.
The Heaven and the Earth
The bondage that couples are tied to is unique. After all, you believe marriages are made in Heaven. Even if you believe marriages are made on Earth, being responsible toward each other every moment is important. When you buy life insurance for your spouse as well as for you, you prove you care so much for your partner. This could be the gift for your spouse on the next anniversary or birthday. This could be an expression of love in the form of pragmatic financial planning. Thus, life insurance for spouses can be a bondage tightener in conjugal relationship. It unites both Heaven and Earth in the small cozy room you two share.
Beyond Death Through Children
Children are us. We live along through them, physically, ideologically and spiritually. We live for them. This is why, we think of a secure future, a better tomorrow for them. Life insurance for spouse can ensure this desire of ours.
As we have already mentioned, no matter who survives, the children benefit from the proceeds. The proceeds that come down to the family becomes a token of parental love. This love carries along the torch of our dream to the world.
Joint Insurance Ruled Out?
Insurance has always had trends. Of late, joint life insurance has gained considerable popularity. And it has its reasons. The second-to-die benefits from the death of the first. That is to say, spouses are beneficiaries to each other in the joint life insurance for spouses. Though projected as a unique concept, joint life insurance has its limitations.
First, joint life insurance for spouses works as a single insurance. The kind of emotional bondage, sense of responsibility that two separate life insurance policies for spouses create are essentially lacking in it.
Secondly, in the event of divorce joint life insurance for spouses might put the future of the children at great stake. Unless there is a split rider, it is not possible to branch it off into individual policies until a certain time passes. Without this rider, the ownership can be a big issue. Unless the ownership is compromised in favor of the parent in charge of the children, the children’s future can face hazards.
What Type of Insurance Should You Buy?
Term, the life insurance program for a temporary period of time, stands in contrast with permanent insurance. The former covers you for particular years and sends in death benefit (that you sign the contract for) when you die within the time.
On the other hand, a permanent or whole life insurance stays in effect as long as you live and pay premiums. An essential feature of this insurance is the living benefit or cash value aspect. Your policy keeps fetching money (in a turtle-slow manner) and adds it to the (formation of) death benefit. Your beneficiaries receive it whenever you die.
So, which of the different types of life insurance policies should you buy when you opt for separate policies?
That much depends on your situation.
When One of You Earn
When one of you are a home-maker, the best choice for you is to buy two different types of policies: one term life insurance and the other whole life insurance. The biggest benefit of two different types of life insurance is no matter when you die, the family will stay financially safe.
Both spouses can go for term life insurance only when the need for protection is temporary. In this case, you need to make sure, once you pass the protection period, things will be the way you wished. We remind you that like most buyers of term insurance (93%) the chances are you will end up losing all your money.
When Both of You Earn
When both of you earn, you might either consider or ignore the issue of life insurance for spouses. Whither way you should go depends on your life situation. If there is a handsome amount coming in from your paycheck and a good bit of it goes to savings regularly, you may often want to ignore life insurance. But if you bear the burdens of mortgage or loans and there are fears death of one will put the other into financial troubles, you can go for term insurance.
The best choice for you is to buy separate term insurance policies on each. And, that should be for as long as there is the risk factor (of paying back the dues) at work. Should there happen anything to one, the other will definitely remain in the safe zone.
You may go for whole life insurance only if you are not ready to lose your money. Or, if you want to leave a legacy for your children, a whole plan should be the right fit for you. Return of Premium (ROP) can also be an excellent choice for you. It returns all your money in the end as well insures you for the longest time and a lot cheaper than whole insurance.
No matter what you buy, life insurance for spouses is not a needless issue.
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