Why life insurance is very important before investing money
Many people ignore insurance. They are not familiar with the different benefits they can get from buying life insurance. They feel that they are simply losing money if they spend money to buy insurance. In the world of personal finance, insurance plays an important role.
In personal finance, we are commonly talking about saving money, budgeting money, and even how we should spend our money wisely. Those are just basic things to talk about in personal finance. We should also talk about emergency funds and insurance.
Emergency funds will not be discussed in this article. I think you will prepare your emergency funds before investing your money. I will give you some reasons why insurance is very important, especially life insurance. Are you ready?
Investing is very exciting and rewarding. But don’t dive into investing right away unless you have emergency funds and, most of all, health and life insurance.
Life insurance is very important because it serves as an income protection for the entire family who is financially dependent on the breadwinner. If the breadwinner is insured and dies, the family will not suffer financially as they may have the money to survive.
In the world of insurance, the money that family members or beneficiaries receive is known as “benefits”. The insurance company will deliver an exact amount of money to the beneficiaries of the insured.
Most of the time, the beneficiaries are those who are financially dependent on the insured. Therefore, if there are people who depend on you financially, you should also immediately buy a life insurance policy.
Okay, enough to talk about the benefits. Let’s learn the reasons why you need to buy life insurance before investing money.
Your investment funds are not enough to help your loved ones financially. The ideal coverage or the nominal amount that your beneficiaries should receive when you die is the equivalent of an annual income of 3 to 5 years.
For example, if your annual income is one hundred thousand dollars ($ 100,000), your beneficiaries must have half a million dollars when you die.
If you have just started investing money and your funds total $ 75,000, your family will be in financial trouble should you die.
Life insurance is one of the important aspects to consider before investing money. Don’t ignore it. Don’t be in a hurry. Plan your investment plan carefully and one of your investment plans is to protect your income first. I hope you learned something today. If you have any questions or want to know more about investing, you can read blogs, ask questions in forums, or attend investment seminars.
