Many “extras” are being eliminated to make more money for the essentials. Insurance is something that many people might overlook. Although life and health insurance can seem unnecessary when not in use, they are important financial investments.
Life Insurance: The Importance of Life Insurance
Life insurance is something you may never need but still need. If you are unable to pay your funeral expenses, life insurance will pay a benefit to your beneficiaries. You can use the money to pay for your funeral expenses (which average around $10,000), and to help your beneficiaries maintain their normal life quality if they are dependent on your income.
If you’re married with children at home, the death of your spouse would have a devastating impact on your family. They would not only be responsible for the funeral costs, but also would be suddenly without their income. Just to make ends work, they could lose their house, car, or other valuable possessions.
However, if you have life insurance your family will be able to cover your funeral expenses. They might be able pay off their mortgage and put the remaining money in a fund that will grow over time. This will allow them to earn some income from the interest. You could have life insurance that covers your children’s college expenses.
You might think that life insurance is unnecessary if you are young and in good health. Even if you are single, your family does not need to be a concern. Your premiums will be very low, making this the best time to purchase life insurance. Your health and age are key factors in determining how much you pay for life insurance. Therefore, the more healthy you are, the lower your premiums will be.
Health Insurance: Why you need it
Many people believe they can do without health insurance. Because most policies have co-pays and deductibles, they will be responsible for paying a lot of their medical bills out of pocket. Like life insurance, health insurance is one of those products you don’t realize you need until it is too late.
While health insurance can help with everyday medical expenses such as vaccinations and checkups, many policies are more suited to cover catastrophic injuries or illnesses. If you suddenly become ill with cancer or another life-threatening disease, health insurance will ensure you have the coverage you need. You will need to pay out of pocket for your treatment. Some hospitals and doctors may require a portion upfront.
Even if your deductible is high and you end up paying a lot of your medical bills yourself you still need insurance. Another reason you should have health insurance is that you will be able to pay less for medical treatment if you are covered. You cannot get discounts from health insurance companies if you’re not insured.