How Much Should You Spend For Life Insurance? - By: ArticleSubmit Auto

Most people understand the importance of life insurance. Not only does it help pay for your funeral and other final expenses, but it also can help take care of any loose ends that you may leave behind, such as credit card bills and other financial issues. It can also help take care of any financial dependents that you leave behind. But how much should you get, and how much is it going to cost? In this article, you'll learn the answer to both those questions.

The first question, how much you should get, depends on a number of factors. If you have dependents, figure on replacing your salary completely for 20 years or so, and then use that as a starting point for the payout, or sometimes referred to as the 'death benefit.' So if you make fifty thousand dollars a year, twenty years of that would be one million dollars. Throw in some for inflation, and figure a million and a half. That should be enough if something happened to you tomorrow, to pay for your family once you're gone.

Now you'll need to determine the cost. If you are going to buy term life, it's going to be much cheaper than whole life. Whole life is insurance along with some kind of investments. Term life is pure insurance. With whole life, you build up cash value, and can have access to that money later on if you need it. If you are only worried about taking care of the people you leave behind, then term life is probably a better option.

Another factor that determines price is your age. The older you get, the more chances you have of dying, so the more you're going to have to pay for your life insurance. Your current state of health is also a consideration. If you smoke or drink excessively, you'll also pay quite a bit more. If you are relatively young, are in good shape, don't smoke or drink, you can get a couple million dollar policy for pretty cheap.

Now that you've got a good idea of what kind to get, and how much it's going to cost, the next step is to shop around for some quotes. Plenty of places give you free quotes on the Internet, so it should be pretty easy. And of course, the longer you wait, the more expensive it's going to be.

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