Family Breadwinner Family Life Insurance Case Study

The family’s breadwinner’s income should be protected by insurance because it provides financial protection for dependents and from creditors, tax benefits and a basis for savings. Most people don’t have an answer to the question of what they are to do if their main source of income were to suddenly die, or suffer from a traumatic, sudden physical ailment. Most people wouldn’t be able to sustain their current lifestyle, keep the lights on in their home or even keep it, let alone afford a college education for their children. Life insurance provides a failsafe for dependents by giving them a set amount of money upon the dependent’s death or sudden physical ailment for a number of things. For example, the money can be used to keep the dependent’s
home and even afford that college education. This benefit gives the dependents a sound financial state of mind. As horrible as it may sound, people do make money solely off of the death of people and scam people in their time of bereavement over the death of a loved one. Protection from creditors, as a benefit of life insurance, is ordered so that death benefits are paid to a named beneficiary versus becoming a part of an estate. This is where creditors claim the cash benefits, whereas dependents can use the money to pay of mortgages and debts, providing that further sense of financial protection. Aside from simply protecting the dependents, they can receive tax benefits. Life insurance money paid to the dependent family are not subject to state or federal income taxes. The family will keep 100% of the money, versus 60%. In some special cases, the money received from life insurance may be free from an estate taxes. There are more than one type of life insurance policies for people who simply want to get through the time of bereavement and/or seek protection. Some types of insurance policies can serve as savings vehicles, though not a considered savings tool. With all the benefits there are to life insurance policies, it takes a certain family: the well informed. This well informed family know how to obtain their life insurance for their breadwinner, how to go about, up keep and the whole nine yards. This is a family that puts their family first. This family knows if they need life insurance or not (which they most likely will) and how much of the right life insurance is right for them.
Members of the family will have assessed their family’s total economic needs. This includes income needed to maintain an adequate lifestyle for them, extra expenses if the income producer dies, special needs of dependents, debt liquidation and liquidity. Next. The family will have determined what financial resources that will be available after death. Then, they will then take what they’ve assed for their family’s total economic needs and subtracted the financial resources available after death which equals the amount of additional life insurance required to protect their family. Afterwards, the family will need to take into consideration some life insurance underwriting to then come to the conclusion of which life insurance is right for them. The smart, well informed family will have done their homework and gone over the pros and cons of each type, comparing costs features, insurance companies and agents. They will have looked at the life insurance contract features and other policy features. The family can use online tools to assist them in their decision making process, to divide up the proceeds, and are aware of the breadwinners’ life
expectancy. The family’s breadwinner’s income should be protected by life insurance because there are a number of benefits for their dependents and it’s the smart thing to do if they dependents want to keep bringing home the whole loaf of bread even after the breadwinner’s death and not just a slice at a time.