Life Insurance – Cover your Basics
Tell me when you are going to die and I will tell you what to buy. Seriously, you need to be able to look at pricing versus how much insurance you need to cover your basics for a certain period of time. Don’t overbuy insurance.
Our thoughts around Life Insurance;
- We believe in protection-based life insurance –life insurance and investments should not be combined for most people
- You are generally covering, your home, your children and your income
- A Rule of Thumb is to buy coverage that is at least 7x your income
- Employer-provided coverage is solid but can have shortcomings (deeper dive)
We usually recommend considering Life Insurance for 3 scenarios:
- You have a life event such as having a kid or having a mortgage (list of life events)
- To cover the basics of your financial plan
- Business planning