STEP 1 - BECOME AN EDUCATED
CONSUMER
How Do Life
Events Affect My Insurance Needs?
If You Have Children
If
you have a wife and children, you will most definately want to opt for
more life insurance. Should something ever happen to you, your children
will undoubtedly be your spouse's biggest expense. Your spouse will
have to provide your children with food, clothing, toys, braces and
perhaps a college education. You want to make sure that you have enough
life insurance to cover these costs and maintain an acceptable standard
of living. Naturally, the more children you have, the more expensive
it will be and the more life insurance you will need.
Beneficiary Designations:
Your spouse should be named
as the beneficiary of your life insurance policy in order to receive
payment if you die. Even if your will says that your spouse is the beneficiary
of the policy, it will not take precedent over the policy's beneficiary
designation. If you have children, you may want to include them as well.
For example, you can name your spouse as primary beneficiary and your
children as secondary beneficiaries. A secondary beneficiary is the
person who will receive payment if the primary beneficiary dies before
you. Naming both your spouse and your children as beneficiaries can
make it easier for your children to collect if something happens to
you and your spouse at the same time (e.g., if both of you die in a
plane crash).
However, keep in mind that courts will not allow minor children to directly
receive the proceeds of a life insurance policy. You will need to set
up a trust to receive any payment for the benefit of your minor children
and name a trustee to manage the trust for the children.
If
You Already Have Life Insurance::
If you already own a life insurance policy when
you get married, you should do the following:
- Review the beneficiary designation (e.g.,
you may want to name your spouse as the beneficiary)
- Review the adequacy
of your coverage (e.g., depending on your situation, you may need
more coverage than you did when you were single)
Other Life Stages
single
|
married |
new baby
|family
|
dependent parents
| retirement
.
