Decide whether you really need life insurance
Do you need life insurance?
The answer to this question depends, ironically, on whether anyone depends on you.
For example, if you have children, then yes, you probably do need life insurance – because they depend on you financially. This is the case even if you don’t work and instead are the unpaid nanny/cleaner/chauffeur/cook/secretary/superhero of the household. If you want to protect your contribution to your family’s finances in the event of your death, you need life insurance.
And children aren’t the only dependents you need to think about. If you don’t have children, but you do have a joint mortgage, and your partner could not meet the monthly payments on his/her salary alone, then life insurance is probably a good idea. Otherwise your beloved could be turfed out by the mortgage lender after your death and – if the property is worth less than the mortgage – pursued for the rest of the debt. Not a pleasant thought.
Similarly, if you support or look after someone financially in any way, be it a friend or relative, then you should consider taking out life insurance to protect them should the worst happen to you.
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