HomeMortgageThe top 10 creative uses of life insurance in financial planning

The top 10 creative uses of life insurance in financial planning

An insurance adviser once shared with me a limerick: The cost of insurance was such, that its price I could sadly not touch, so I turned down the offers, then filled government coffers, and now it costs three times as much. I thought it was a valiant attempt to sell me a policy.

If you are going to invest in an insurance policy, you need to understand what you’re accomplishing with the insurance. There may be more than one answer. Consider these top 10 uses of life insurance.

1. Providing for dependants. If you were gone tomorrow, would the loss of your income cause your dependants financial hardship? If so, life insurance can fill the gap by providing money to invest to generate income. This is particularly helpful if you’re asset-rich, but those assets are illiquid (such as real estate or a business.) Unless those assets produce sufficient income or can be easily sold to free up…

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