Do You Need Life Insurance Now

As with many decisions that we need to make concerning on what we must spend our money on and what is not absolutely required, the need for life insurance will depend on your personal circumstances. For some people they do not really need it and they should invest their money elsewhere. For other people they must have life insurance and are undertaking a big risk in not having it, whether they know that or not.

You potentially do not need life insurance if you are well off and your death would not leave your dependants in any financial hardship. Typically you would have no debts, you have substantial investments that bring in a regular income and these investments could be realized as cash, if required to do so. You have provided a home that meets the basic requirements and any future funding requirement (like college) has been planned for and funds are available.

You do need life insurance if your dependants rely on you for their income and provide them with food, clothing and shelter.  This situation is usually someone who is the sole earner of income for the family. One typical example is a couple who have children. One of partners stays home whilst the other goes to work and earns the paycheck. If the working partner was to suddenly die, then life insurance would be needed to pay the regular bills and to ensure the family still had food, clothing and shelter, otherwise the family could face severe hardship.

There can be many variations to this scenario, such as a son that looks after his parents, a sister that looks after her brother and so forth.  The common element is that one person is supporting one or more other people and if that one person was to die, then life insurance would provide the necessary funds to enable the survivors to continue living.

Life insurance is not for everybody but it is mandatory for some people, based on their current financial and family circumstances.