Only 44% of households had individual life insurance policies in 2010, so one could say that the average person does not have any life insurance. And studies show that most people who do have life insurance are under-insured.
For those who do have life insurance, many people use the rule of thumb of taking a face amount that roughly equals 7-10 times their annual salary.
Why do less than half of the U.S. population have individual life insurance?
In my experience, the majority believes their group term life insurance death benefit provided through their employer will be enough to pay their financial obligations at their death. This may be true but only for those who die during their employment. But what is the percentage risk of that happening? I saw a study on the percentage of all term insurance plans which included group term that was in force when the insured died was less than 2%. That means 98% of the insureds and beneficiaries received $0.00 dollars from their term insurance plans.
Would I advise not buying term insurance? 'NO' but I would only use term insurance to pay for temporary needs for cash, such as: payment of the Mortgage balance, cash to provide for children's education, and debts that will be paid off prior to retirement.
For financial obligations beyond retirement will need to be covered with personal savings or permanent life insurance plans. But for most savings or permanent insurance proceeds are insufficient to provide the Lifetime Income need for their Surviving souse.
However, there is a NEW product design available that is much more affordable when Survivor income is the need. It has no product equal. It's filed and approved in 47 states as a Reversionary Annuity. It's a Survivor lifetime annuity that you do not have to fully fund.
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For those who do have life insurance, many people use the rule of thumb of taking a face amount that roughly equals 7-10 times their annual salary.
In my experience, the majority believes their group term life insurance death benefit provided through their employer will be enough to pay their financial obligations at their death. This may be true but only for those who die during their employment. But what is the percentage risk of that happening? I saw a study on the percentage of all term insurance plans which included group term that was in force when the insured died was less than 2%. That means 98% of the insureds and beneficiaries received $0.00 dollars from their term insurance plans.
Would I advise not buying term insurance? 'NO' but I would only use term insurance to pay for temporary needs for cash, such as: payment of the Mortgage balance, cash to provide for children's education, and debts that will be paid off prior to retirement.
For financial obligations beyond retirement will need to be covered with personal savings or permanent life insurance plans. But for most savings or permanent insurance proceeds are insufficient to provide the Lifetime Income need for their Surviving souse.
However, there is a NEW product design available that is much more affordable when Survivor income is the need. It has no product equal. It's filed and approved in 47 states as a Reversionary Annuity. It's a Survivor lifetime annuity that you do not have to fully fund.