Life Insurance Tips for Smart Parents

Once you have children, your responsibility is to care for them as best you can, even in the event of your death. This is why life insurance is so important today - it safeguards the well-being of your children even when you can't be there.

There are two types of life insurance, term and whole life. Term insurance is only good for a certain term, say 10 years or so. Term life insurance policies may seem like a good financial deal, but keep in mind that when they expire you'll have to reapply, and premiums will be higher due to your age.

Whole life insurance has no time limit, though they do cost more. These policies are best obtained when the insured is relatively young, so that premiums can be more affordable. There are also more financial variations available for whole life policies, including the ability to borrow cash values or cash out before death.

The type of life insurance that is right for you will depend on the number and ages of your children, your income level, debt level, and the value of your assets. A good guideline is to buy coverage at six to eight times your annual salary.

Speak to a knowledgeable agent about your insurance needs, what you want to provide for your children in the event of your death, and what kind of options you find most attractive. And be sure to purchase only what you can afford; you can always upgrade later if your finances allow it.