Auto news on Youtube Sep 29 2018

Welcome to Quotacy's Q&A Friday

where we answer your life insurance questions.

Quotacy is an online life insurance agency

where you can get life insurance on your terms.

I'm Jeanna and I'm Natasha.

Today's question is how long should my term life insurance last?

How long of a term you buy is dependent

on why you're buying life insurance in the first place.

Do you have a family and are looking to buy life insurance

to protect them as you pay off the mortgage?

Do you have children and also plan on paying for their college tuition?

Or maybe you're looking to buy life insurance to cover a business debt.

When it comes to buying term life insurance

the most common lengths are 10, 15, 20, and 30 years.

So if you buy a term life insurance policy for 20 years,

the day it becomes active it will insure you for 20 years from that date.

If you are planning on starting a family soon

or have young children like an infant or toddler

a 30 year term policy is a great option.

so it will protect your family as your children grow up

and become financially independent themselves.

Term life insurance is there to protect

your loved ones from the what-ifs in life.

If you were to die suddenly, the death benefit from

a life insurance policy can ensure your family

can stay in their home and not be uprooted.

So making sure your term length matches

your mortgage loan length is a great idea.

Are there any debts you have that could

become the responsibility of someone else

if you were to die before the balance is paid?

Any debt you have that is co-signed or part of a joint account

will become the responsibility of that other person.

Purchase a term length that takes into account

how long it will take you to pay off these debts.

If you and your spouse live in a community-property state

even debts your spouse did not cosign may become

his or her responsibility if the debt was acquired during marriage.

And even if your family members do not become

directly responsible for your debt when you die

creditors still want to be paid somehow.

They will file a claim against your estate upon your death

which takes away inheritance from your loved ones.

Life insurance, however, is exempt from probate

which means your loved ones will get the full

death benefit amount even if there are creditors at large.

Another common reason people buy life insurance is for

collateral for a small business loan.

In order for a bank to approve your small business loan

they want to make sure they'll get paid if you die.

Purchasing a term life insurance policy for

the length of the business loan and naming

the bank the beneficiary is common practice.

It can be set up so that the bank gets paid first

and then your families get the remaining death benefit.

And if you need more coverage than 10 to 35 years,

you could consider getting a permanent policy

or laddering life insurance policies.

Permanent life insurance lasts your entire life

whereas term life insurance is temporary and is

designed to only last during your family's most financially

vulnerable years and then drop off when you become

more financially stable or in or near retirement.

When you ladder term life insurance policies,

this is when you own more than one policy with various

amounts of coverage or at different stages of your life.

Let's take a look at an example buying

three term policies all at once.

Jim and his wife Pam just purchased their first home.

They want to start a family soon.

Jim decides to buy three term life insurance policies on himself

naming Pam the beneficiary.

Policy one has a 35-year term and will insure Pam is

financially protected through their prime working years.

Policy two has a 20-year term and will make sure Pam

can continue to pay the mortgage and

start college tuition funds for their children if

Jim were to pass away suddenly.

Policy three has a 10-year term and simply adds

extra coverage to ensure Pam will have the necessary funds

to continue their family's standard of living

during their children's most formative years.

As the mortgage is slowly paid off and

their children grow to become independent,

their coverage needs also lessen,

which makes this laddering method a strategic one.

Now, let's look at an example of buying

three different term policies at different stages of your life.

Blair and her husband Chuck are newlyweds on a budget.

Blair decides to purchase a small life insurance policy

on herself to make sure Chuck could pay for a funeral

and take care of the debt they share

if she were to die suddenly within the next ten years.

Five years into their marriage, Blair and Chuck save up

enough for a down payment and buy their first home.

Blair then decides to buy a second term life insurance policy

with a term length of 30 years,

the entire length of their mortgage loan,

so Chuck could continue to live in their home if she died.

At 55 years old, Blair and Chuck

are just a decade away from retiring.

She wants to make sure if anything happened to her

Chuck wouldn't need to dip into his retirement savings

to continue paying bills.

She buys another small term policy with a 10-year term.

Term life insurance is an affordable way to protect

your family from the what-ifs in life.

If you aren't sure how long of a term you should buy,

check out the blog link posted below.

Or contact Quotacy and our agents would be more than

happy to help you figure it out.

And if you aren't sure about what amount of coverage

you need, we also posted a link below

to our free life insurance needs calculator.

Simply answer three questions and the calculator will

show you an estimate how much term life insurance

coverage you need.

Thanks for watching!

Tune in next week when we talk about

what life insurance company niches are and

how they can save you money on premiums.

Bye!