Life Insurance: Do You Have Enough?
We’ve all seen them; the GoFundMe® requests shared by friends on Facebook alerting us to a tragedy in our community. A young parent or a child taken too soon, and friends, loved ones and communities rally to help with funeral costs and future expenses. In fact, communities assisting families through such tragedies are the basis for the formation of many fraternal life insurance companies, such as GBU Life. With group life insurance available through many employers, it can be easy to sign up for what is offered and not think about it again. However, it is essential to consider what the true needs of your family are regularly to ensure that your life insurance coverage is sufficient for each phase of your life.

The experts at GBU Life recommend reviewing your life insurance annually to evaluate if you need to add to the face value, look at additional rider options, or even look at different policy types, depending on your phase of life. One of the key areas of life where families often find themselves underinsured is during the “busy years.” Usually, between the ages of 25 and 55, you are working hard to build a life for yourself and your family. This is the time where you are accumulating assets. You may be paying a mortgage and raising children. College tuition may be looming on the horizon (or you still may be paying for your own). Here are some things to think about to ensure that you have the right amount of coverage during this very active phase of your life.

Buy whole life coverage as early as you can
Just as it sounds, whole life coverage is life insurance coverage that remains in effect for your entire life as long as premiums are paid, or the policy is paid in full. Although whole life policies may cost more initially than a term policy, whole life policies build cash value over time and guarantee your coverage, even if your health declines and you are not eligible for term insurance.

You will never be younger than you are right now, so if you are in good health, now is the perfect time to purchase a whole life policy with a guaranteed renewal option rider. Buying a smaller whole life policy now and adding more coverage during guaranteed purchase periods (as you are able) helps you build your coverage over time. It also ensures that you can grow your coverage even if your health should decline in the future.

Use term coverage to fill in the gaps
Term insurance is life insurance coverage that covers you for a certain period. Once the pre-determined period is over, you are no longer covered unless you renew. When it is time to renew, your health and age will be considered to determine your coverage and cost. For that reason, it is best to purchase the term insurance you think you will need for the most extended and available term (usually 30-35 years).

Be sure to consider what your life will look like for the next several decades. Often the term insurance offered through your employer is not enough to cover these expenses. Be sure to analyze your needs with your agent and supplement with additional term insurance during these years. Consider long- and short-term debt such as a mortgage, student loan debt, future college tuition and childcare. You may not always have these expenses, but it is crucial that while you do, your family will have the means to pay off debt and replace lost income if the worst happens.

Plan for the “what if’s”
Many life insurance policies have riders available that can be added to the policy for an additional cost. Be sure to review the rider options for both your whole life and term policies and consider adding these options. Rider options can help you to mitigate additional risks. For example, a children’s term rider automatically covers all current and future children for one price. Living benefits riders allow you to use some or most of your life insurance benefits in advance if you meet specific medical criteria, such as a terminal or critical illness. Other options such as waiver of premium or borrowing from the cash value can help you should you experience a period of financial difficulty along the way.

If you are interested in talking with a qualified life insurance agent about your life insurance needs, visit gbu.org to schedule an appointment.

About GBU Life
GBU Life (GBU) is a member-owned, community-focused provider of life insurance and annuity products headquartered in Pittsburgh, Pennsylvania. Since its founding in 1892, GBU has helped its members secure their families’ financial futures while supporting members in giving back to the causes they are passionate about in their communities. If you have a passion for helping in your community, a GBU membership provides benefits such as local and national retail and restaurant discounts, educational scholarships and grants, matching funds for non-profit organizations, reimbursement for community projects and matching donations for volunteer hours.

You can become a member of GBU Life by purchasing a life insurance or annuity product or by buying a social membership for just $25 per year. Visit gbucares.org/membership to find out more about becoming a social or an insured member of GBU Life.

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