hgazette.com, Haverhill, MA


February 15, 2012

How to insure a great Valentine's Day

Valentine's Day is upon us. To celebrate, you may present your loved ones with chocolates, flowers or any number of other traditional gifts. But if your valentine also happens to be your spouse or your life partner, you also might want to show your love in another way — by making sure you have adequate insurance.

Just consider some of the things that life insurance can do for you and your family:

Pay off your mortgage: With sufficient life insurance, your family can remain in their home should anything happen to you.

Educate your children: College is expensive, and it seems to get more costly every year. If you were to die prematurely, your life insurance proceeds could help pay for your children's education.

Help fund retirement: Term insurance consists of just a death benefit. But "permanent" insurance policies, such as whole life or universal life, have a tax-advantaged savings component that could help pay for your retirement and help keep you financially independent — which means you won't have to worry about being a "burden" to your grown children. Furthermore, proceeds from your life insurance policy could help your surviving spouse retire more comfortably.

Help protect your business: If you're involved in a family-owned business enterprise, you can structure a life insurance policy to help preserve the business or transfer it to the next generation.

Pay for estate taxes: If your estate is sizable, it could generate estate taxes. Life insurance proceeds can help your heirs pay these taxes.

Clearly, life insurance offers a variety of benefits. But how much do you need? And what type do you need? You might hear that your coverage should be worth around seven or eight times your annual salary. But there's really no one-size-fits-all formula. In determining how much life insurance you require, you should consider your age, your income, the size of your family, the amount of your mortgage, whether your spouse has a retirement account, your financial goals and other factors. Your financial advisor can help you assess these variables to determine the appropriate level of coverage.

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