There are all kinds of life insurance policies of course and depending on your needs, your specific situation and what you can afford to pay, chances are that you’ll end up with a specific insurance policy, hopefully the right one. I personally ended up buying a 20 year policy after getting married. We knew that we were going to buy a house in the following months so the main focus was on making sure that if something happened to one of us, the remaining partner would not have too much of a financial burden. We basically got enough to pay off the house if something happened with a 20 year term policy. The idea was that 20 years from now, we hope (and plan to) have our mortgage paid off. At the time, there did not seem to be need for more.
A few months later, we did buy our house, moved in and later that year, we found out that my wife was pregnant!! Time flew by, our baby boy was born in June 2012 and as many of you know all too well, life became crazy/insane/hectic/amazing/wonderful, etc 🙂 Now, he’s almost 1 year old, starting to sleep better nights and we’re finally gaining control again. Thanks to that, I’ve started looking into different things that I honestly did not have the energy or interest for in the earlier days. Things like setting up a fund for his education, updating my will, and looking at how my insurance needs have changed.
Have My Insurance Needs Changed?
So yesterday I started thinking about the impact of having a baby on my insurance needs. Clearly, the biggest change is in my life insurance needs. If I and/or my wife would suffer a fatal accident, there is no doubt that the consequences would be much more severe. Yes, paying off the house would be a major factor but taking care of our little boy would be the top priority and I think it’s fair to say that raising a kid is expensive. I don’t worry about it if my wife and I are raising him. But what if one of us is no longer there? What if someone in my family has to take care of him? It’s more than enough for that person to worry about him. There’s no need to add a major financial burden at the same time. So we’d need to make sure that this person would have enough financial means to take care of him if something happened.
Another point to consider is the list of beneficiaries if something did happen. There is no doubt that our son would now receive a large portion of that money which is yet another reason to have our current policy updated.
What Is Next?
I guess my main priority right now is getting additional life insurance to cover both financial needs related to raising my son if something did happen (more term insurance basically) but also possibly buying a whole life insurance policy that would help him out whenever we did pass away. This would not so much be in terms of needs but more to help him out. I’ll certainly keep you posted on my progress in that regard.