The Basics of Insurance
Reaching your financial goals involves protecting your assets as well as managing them.
Life Insurance is not for the very rich but to fill a void in a young family’s beginning when liabilities are high and assets are little. With a new home, a mortgage and young children, life, disability and home owner’s insurance are critical to a family’s well being.
Term life insurance policies are not very expensive. A young couple (with non smoker’s discount) can buy a 20 year term policy life insurance policy for a few hundred dollars a year.
Protect your family and assets with adequate health insurance. Be sure to buy travel insurance when you are out of the country. There are plans available for as little as $5 per month which includes theft and medical care in a foreign country.
When you purchase your first home the bank holding your mortgage makes it mandatory that you purchase home owner’s liability of fire insurance to protect the home. You can buy separate mortgage insurance if your choose but most people can simply use their term life insurance to cover the mortgage risk. This insurance is generally less expensive.
If you should get sick or disabled then you will need disability insurance to protect your family and income.
An accident can cause hundreds of thousands of dollars in bills if you are uninsured.
Shop around as there are many insurance products available to fit specific needs.
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Make a plan and identify your goal
Stop wasteful spending
Acquire a good education
Find quality employment
Savings and investments
Buy your first home
Buy adequate insurance
Insurance Basics – Part 2