For young couples just getting started, new commitments, such as buying your first home or having children, bring with them the responsibility of making sure your loved ones will be provided for financially. Life insurance can help your loved ones maintain their standard of living and keep your family’s plans for the future on track after you’ve passed away. The benefits of life insurance can be ambiguous so it’s important to talk with experts regarding the myths that have been passed around.

 

MYTH NO. 1: I only need life insurance if I’m the primary breadwinner. Whether you bring home the largest paycheck in your household or not one at all, your family relies on your income and what you do for the family. Both would be missed if something unexpected were to happen to you. Stay-at-home parents perform valuable services such as childcare, cooking, housecleaning, and household management, which can be as costly to replace as a full-time worker’s income.

 

MYTH NO. 2: If I still need protection when the term policy ends, I can always renew the policy. Term life insurance is popular with young families, as it typically offers the greatest coverage for the lowest cost. Term insurance provides protection for needs that will disappear over time, such as a mortgage or a child’s education. However, even after the kids are grown and the mortgage is paid off, the need to provide income for a surviving spouse, eliminate debts, pay taxes, can be covered through insurance. Premiums increase with age and health issues so renewing your policy when the term expires can be very expensive.

 

MYTH NO. 3: I’m young so I only need term life insurance. Term life insurance makes sense for many young families because their need for coverage is great and their budgets are often limited. But there are other options. Permanent insurance policies provide a death benefit as well as other unique features such as lifelong protection and the ability to accumulate cash values. You can access the cash values for important uses like education expenses or business opportunities. There are ways to combine both term and permanent for optimal coverage.

 

We know that insurance can be a daunting product to understand and you’re probably wondering if your family needs it right now. We are happy to answer questions, discuss these myths!

Adapted from LifeHappens¹

Securities offered through SCF Securities,Inc. Member FINRA/SIPC 155 E. Shaw Ave. Suite 102, Fresno, CA 93710 • (800) 955-2517 •Fax (559) 456- 6109. SCF Securities, Inc. and Creative Financial Strategies LLC are independently owned and operated. www.scfsecurities.com Note: Securities offered through SCF Securities Inc., Investment Advisory Services offered through SCF Investment Advisors, Inc.This document is for educational purposes only and should not be construed as legal or tax advice. One should consult a legal or tax professional regarding their own personal situation. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products offered by an insurance company. They do not refer in any way to securities or investment advisory products Insurance policy applications are vetted through an underwriting process set forth by the issuing insurance company. Some applications may not be accepted based upon adverse underwriting results.  Death benefit payouts are based upon the claims paying ability of the issuing insurance company. The firm providing this document is not affiliated with the Social Security Administration or any other government entity.

[1] https://lifehappens.org/blog/3-life-insurance-myths-that-could-hurt-young-families/