This collection of personal financial information is directed to works for a
living. Everyone needs to know more about financial matters. The SOURCE
for much of this information is the GSA Consumer Information Catalog published
by the Federal Citizen Information Center.
Click Next Section at the bottom of each page to work through this helpful
information about Life Insurance.
Life Insurance is the foundation of financial
security for you and your family. It protects your financial resources
against the uncertainties of lie so you can plan for the future.
Choosing a life insurance product is an important
decision, but it can be complicated. As with any major purchase, it is
important that you understand your needs and the options available to
The American Council of Life Insurance (ACLI) has
prepared this guide to help you know what questions to ask when you're
buying life insurance.
The ACLI is a trade association of more than 500
life insurance companies, which collectively provide about 90 percent of
the life insurance in the United States.
Why do I need life insurance? The main
purpose of life insurance is to provide cash to your family after you
die. The money your dependents will receive (the "death
benefit") is an important financial resource: It can help pay the
mortgage, run the household, end ensure that your dependents aren't
burdened with debt. The proceeds from a life insurance policy could mean
that they won't have to sell assets to pay outstanding bills or taxes.
What's more, there is no federal income tax on life insurance benefits.
Where do I Begin? Start by evaluating your
family's needs. Gather all your personal financial information and
estimate what your family will need after you're gone. Include ongoing
expenses (such as day care, tuition or retirement) and immediate
expenses at the time of death (like medical bills, burial costs, and
estate taxes). Your family also may need funds to help them readjust...
perhaps to finance a move, or pay expenses while job hunting. Remember,
life insurance provides financial protection. If protection is not your
primary goal, you should consider other financial products
How much life insurance will I need to
purchase? While there's no substitute for evaluating needs, one rule
of thumb is to buy life insurance equal to five to seven times your
annual gross income.
What are the different types of life
insurance? There are many kinds of insurance, but they generally
fall into two categories: term insurance and permanent insurance.
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