Most people find conversations about death uncomfortable. It’s an understandable response, the ever-present impermanence of life is usually so far tucked in the back of our minds that we forget about it entirely until someone brings it up (sorry, by the way).

However, if you have a family or people you otherwise care about, it’s important to financially plan for a time when you are no longer with them. One of the common ways of doing so is investing in life insurance.

Life Insurance

Life insurance is a policy that a living person pays into that, upon their death or another preset circumstance, is paid to their chosen beneficiary. It differs from straight up estate and inheritance in that it is usually not taxed by the federal government directly.

It may seem like another unneeded financial burden for lower-income families. In reality, it can be a major help to your surviving relatives (particularly children) and cover costs you may not have thought of if you happen to die unexpectedly. We’ve got a few of the major reasons you should consider taking out a policy.


If you are the primary breadwinner of your family, your passing won’t just be emotionally devastating, but it will also change your family’s financial life entirely at the worst possible time. Life insurance will give your family a bit of a cushion. It will allow them to take a beat before having to figure out how they’re going to support their livelihood moving forward.

Moreover, I’m sad to say that in America, death isn’t cheap. Funeral services commonly range from about $7,000-$10,000. That’s assuming you leave your family with no debt. Some debts die with you, but most don’t they are just moved to your heir or your estate. Life insurance can help your family manage them.

Create Inheritance

Not everyone can leave their families as much as they would like to when they die. Even if you die not owning much or having much money, if you’ve paid for a life insurance policy, you can leave behind more than you actually had.

Other Things You Should Know

Tell your family about the life insurance policy. If they don’t know they may never get what is rightfully theirs. Several large life insurance companies were investigated for failing to inform beneficiaries of their policies after the policyholder had passed.

Stick with the ‘Term’ type of policies. There are various others, but term handles all of the issues you’d get the insurance for in the first place and it isn’t as expensive as some of the others the insurance salespeople might try to sell you.

Your lifestyle will affect how much you have to pay. If you have a risky job or unhealthy habits, you’ll have to pay more for your policy. It’s even gotten to the point where your financial prudence comes under a microscope. Any reason an insurance company can find to raise the price on you, they probably will. Just keep that in mind.

This last one might seem obvious, but the insurance company is looking for any excuse to pay as little as possible to your beneficiaries. Don’t give them any!