Do you have enough life insurance? A quick coverage check-up
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TL;DR
- Life insurance is often purchased at major life milestones but needs regular review as financial situations evolve.
- To assess coverage, calculate income replacement needs, considering dependents and duration of support.
- Account for the financial value of unpaid work, such as childcare, in your coverage assessment.
- Inventory major financial obligations like mortgages, debts, and future expenses such as college costs.
- Subtract available financial resources like savings and investments from the total need.
- Major life changes like marriage, divorce, or having children necessitate a policy review.
- Consider if the type of coverage (term vs. permanent) still aligns with your financial goals.
- A policy should not be a 'set-it-and-forget-it' decision; regular comparisons with current needs are essential.