April 25, 2016

Do I Need Life Insurance

richardBy Richard J. Schillig, CLU, ChFC, LUTCF
Independent Insurance and Financial Advisor

At some point in our lives we are faced with the question of whether we need life insurance. Simple answer, NO you don’t need life insurance, but your survivors DO need life insurance on you. Life insurance has several purposes. Its most important function is to replace the earnings that would cease at the death of the insured. Further for businesses, life insurance is a way to protect key employees and the business itself. A third purpose is to use the life insurance to pay remain debts and final expenses.

During our earning years, our family and/or our business could suffer a severe economic loss as a result of losing your current and future income. Regular bills, mortgages, outstanding debts and possibly future expenses as college and retirement will continue to have to be met. Achieving these goals may be virtually impossible for family or for business with the loss of your steady income. In retirement too many believe there is no longer a need for life insurance. But remember, surviving spouses often are dependent on our retirement income for their own retirement income. Life insurance offers a way for family and business to continue living and thriving. In my insurance career, I’ve always found that husbands seldom believe in life insurance but widows always do. And widows always say the amount of life insurance is not adequate.

If you’re still unsure about whether you should buy life insurance, a good question to ask yourself is: If I died today with no life insurance, would my family need to make substantial financial sacrifices and give up the lifestyle to which they’ve become (e.g. house payment, car payment, college tuition)? If you’re a currently retired couple, ask yourself the question: If I died today how much of my (our) retirement income will be lost? Remember if you are a retired couple, one social security check will be lost. Further pension income is often reduced – often by as much as 50 percent. Additional retirement income annuities may also be substantially reduced or eliminated. Life insurance is often needed to replace retiree income. In business ask yourself the same questions. How much business revenue would continue if I was no longer here and generating business revenue. These are the purposes for life insurance. Life insurance allows for continuation of income for young families or continuation of valued retirement income. Businesses may continue to survive with the revenue generated from life insurance. Further life insurance is often used to pay for final expenses and even probate or estate settlement costs. Life insurance is needed. We need life insurance.

When you decide you need life insurance, don’t put off buying it. I encourage you to consult with a financial professional that knows and understands life insurance. Although no one wants to think about and plan for his or her own death,  death is a part of life and needs to be planned for. There are different kinds of life insurance. Historically the two kinds of life insurance was term life and whole life. Today there are other life insurances; universal, variable, flexible premium, and other different plans or combinations of plans. Don’t fail to think about this vital component of our financial planning.

As with many other types of insurances remember life insurance is important. Another very important insurance is the Medicare insurance choice we make as we age into Medicare. Our firm continues the monthly Community Meetings during April. Please call us 563-332-2200 or email us at rjsandassoc@att.net regarding those special days on April 19 and April 21.


Richard J. Schillig, CLU, ChFC, LUTCF is an Independent Insurance and Financial Advisor with RJS and Associates, Inc. He can be reached at (563) 332-2200.

Filed Under: Finance, Retirement

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