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Is it worth insuring your life so as not to leave your family without means of livelihood if something happens to you? There is no universal answer to this question. It is necessary to make a decision based on the individual financial capabilities and abilities of each individual family.
In this article, we will figure out where and how to start assessing and analyzing the financial situation of your family. As a result, you will be able to decide whether you need to insure your life and pay monthly insurance premiums, or it will not be such a necessary waste of money for you.
To begin with, you need to take into account all major sources of income and expenses. Mortgages, car loans, household appliances loans, credit card debts — remember and write down all your monthly payments. We will talk about daily expenses in the next paragraph. Next, all assets should be taken into account: savings, investments. You need to calculate how much this money will be enough to pay off loans if your contributions stop right now.
Awareness of where money is spent from day to day will greatly help you understand whether your family can exist without your earnings. And if you have recorded monthly expenses for at least the previous two years, then this will give you an excellent basis for analyzing family expenses in the future. Think about whether your family will be able to maintain the same standard of living and pay for all these expenses if your income suddenly disappears? Will it be a serious gap in the budget? Then you need life insurance.
Let's say your family will be able to provide for themselves today without your income. But look into the future. Do children need to go to university? This is also an expense. Or, perhaps, you want to protect your savings, you want them to go to your children and grandchildren, and not go to the urgent payment of loans or your funeral. By the way, if we are talking about this, funerals are an expensive event, and after they are held, your family may end up in debt.
And although the previous points could push many to the decision to insure their lives, still do not rush. Let's list the points, the presence of which makes life insurance an unnecessary waste of money for you:
your family is not paying off a mortgage or other serious loan;
you don't have children or they have already grown up and graduated from university;
your family members earn enough and may well do without your earnings;
