To be effective, life insurance should match your lifestyle. This type of investment is not one that typically should remain the same throughout your lifetime. It is wise to revisit the plan at least one time a year.
Consider the ways your life changed over the last 12 months. If you made significant changes, adjust your life insurance policy to reflect them. Buying a home is such a change.
Why Buying a Home Impacts Life Insurance
It may not seem like a simple connection. Yet, when you buy a home, you take on a large amount of debt. This may be the largest investment many Americans make in their lifetime. That places a significant amount of pressure on you and your spouse. Should something happen to one of you, the other must continue to make payments. If unable to do so, the lender could foreclose on the home. This can be financially devastating as well. Yet, this type of risk does not have to happen.
If a homeowner obtains life insurance, the policy can help. The spouse can use the funds to keep making monthly mortgage payments. In some cases, he or she can also use the funds to pay off the existing debt. This allows your loved ones to keep living in the home long term. It can give you peace of mind knowing they have protection.
How to Update Your Policy
You purchased a home. Now, take a look at your existing life insurance policy. How much value does it provide? Consider the cost to pay off your new mortgage. There are also costs in upkeep and taxes to consider. You still want to provide enough funds to cover your loved one’s other needs as well. Work with your life insurance agent to update your coverage.
Adding coverage does not have to be expensive. However, the amount you need depends on your family’s monthly income. It also depends on your financial contributions. Balance the cost of the policy with your family’s actual need.
If you do not have life insurance, now is a good time to get a plan. Most insurers will work with you to find the best fit. Do not assume your current coverage is enough, many homeowners are under-insured. Don’t assume the lowest valued plan is enough either. Rather, take the time to consider your new expenses to ensure you get the right overall fit.
Need life insurance? We’re here to help. Call Fearnow Insurance at (252) 238-4726 for a fast, free life insurance quote.