Hi everyone this is Dennis today we're going the most simple kind of life insurance and the one that most financial advisers will. so you should choose and that is term bill life insurance. what you're going to learn in this article is the following we're going to talk about the death benefit, the reason you have a term life insurance what the whole term means with the best value of your term life policies and finally the beneficiary.
Let's start with death benefit
The entire purpose of a turn life is the death benefit if you pass away while the policy is in place the insurance companies will pay and amount of money to the person or entity that you designate as your beneficiary. So some money is going to be put into the hands of the people you left behind or the entities that you left behind when you pass away.
The whole term is a very specific part of the term life policy is simply the period of time that the price of the policy is locked in so the price has not changed during the term that you have chosen.
So let's take an example, here a twenty years which is a twenty year term policy priced at one two three forty three ages made that number of per month would stay twenty three forty three for twenty years.
So the insurance company could not change the price on you no matter what happens with your health or anything like that for the twenty years.
is that the policy is in place something interesting the most will don't know is that after that twenty years.
The policy does not just and if you're still alive it will continue but the price will increase dramatically most of the time you don't want to continue with the policy after the term and because
the prices prohibitive let's talk about the best values.
Other part of your term life policy that face values the amount of money that will be paid out as the death benefit to your the fish he area so it's the amount of money you choose that will be paid by the life insurance companies to your beneficiaries. So on example a common example is a two hundred and fifty thousand dollar face, and you would pay two hundred and fifty thousand dollars as the death benefit if you were to pass away while the policy is in place.
So we have the term the period of time that the price won't change and the phase value which is how much will actually be paid out in the case of your passing.
The third element here is your beneficiary i'd mentioned it before in the article and this is simply the person people business or not a nonprofit organ causation that receives that death benefits so this is
do you choose to get the money if you were to pass away the most common example is a space so husband or wife that you are married to and you have a family together or whatever and you want to know that if you were pass away they could take care of the family.
Maybe pay off the mortgage cover any money that you were bringing in for a period of time and you get resettled because of your last so that is the most common beneficiary but there are certainly
other examples some of them include and a state or trusts a few set up a will or a trust which i suggest everyone, and then you may just direct your life insurance policy to that a state and then the directive of the state would be would figure out where that money and you could but scented specifically to your children sometimes people do this.
But i only recommend that you have a trust that makes it clear you know, if you had a two hundred and fifty that was another face value and you had an eight year old and you were to passed away suddenly that eight year old is responsible for two hundred and fifty thousand dollars without any restrictions that concrete a lot of problems and so most financial advisers including myself would say you know create a trust before you create your child is the benefit.
You could create a parent oftentimes kids that are in college to have student loans would make a parent the and a fish he area of a small life insurance policy so if they were to passed away those students that's a student and it wouldn't become a burden on their parents and you could also choose your favorite charities certainly there are people who purchase a life insurance policy and if they were to pass away those dollars would go to quickly to the charity of their choice so the bad fish share the person or and that means that receives the face value or the death benefit of your life insurance policy finally.
cookie mistake that folks make and his is so it why does not telling family members how to find your policy when you purchase a term life policy you need to make sure.