{"id":689,"date":"2018-12-15T02:06:35","date_gmt":"2018-12-15T02:06:35","guid":{"rendered":"https:\/\/ladderlife.com/blog\/?p=689"},"modified":"2021-05-19T19:23:33","modified_gmt":"2021-05-19T19:23:33","slug":"life-insurance-missing-piece-financial-plan","status":"publish","type":"post","link":"https:\/\/ladderlife.com/blog\/2018\/12\/15\/life-insurance-missing-piece-financial-plan\/","title":{"rendered":"Life Insurance: The Missing Piece in Your Financial Plan"},"content":{"rendered":"\n<p><strong>by Erica Gellerman, <\/strong><a href=\"https:\/\/theworthproject.co\/\"><strong>The Worth Project<\/strong><\/a><\/p>\n\n\n\n<p>You\u2019re doing all of the things that signal you have your financial life together: you\u2019re paying down debt, you have a monthly budget, and you\u2019re putting money away for your golden years. But even though you\u2019re doing all of the right things today, do you know if you\u2019re covered should something unexpected happen down the road?<br><\/p>\n\n\n\n<p>Life insurance plays an important \u2014 but often overlooked \u2014 role in a financial plan. Only <a href=\"https:\/\/www.chicagofed.org\/publications\/economic-perspectives\/2017\/8\">60% of households have life insurance<\/a> and the <a href=\"http:\/\/www.nber.org\/digest\/mar00\/w7372.html\">National Bureau of Economic Research reports that a significant number of households are underinsured<\/a>. <br><\/p>\n\n\n\n<p>In this article, we\u2019ll break down how you can use life insurance to make your financial plan run smoothly, no matter what life throws your way. <br><\/p>\n\n\n\n<h3><strong>What\u2019s your financial plan?<\/strong><\/h3>\n\n\n\n<p>You may not realize that you have a financial plan, but if you\u2019re setting savings goals and putting away money for a rainy day, you\u2019ve created the start of your financial plan. <br><\/p>\n\n\n\n<p>The easiest way to think of a financial plan is as a roadmap for where you want to go in life. It starts by identifying where you are and breaks down exactly how you\u2019ll achieve those goals. Your financial plan can include things like planning for retirement, buying a home, and sending your kids to college. <br><\/p>\n\n\n\n<p>Once you\u2019ve created your plan, either with an advisor, or on your own, you\u2019ll know exactly what you need to save and earn for years into the future. Your plan probably has things mapped out neatly: if you save <em>X<\/em> dollars each month, you\u2019ll be able to help your child go to the college of their choice. Or, if you keep making your mortgage payments, in 15 years you\u2019ll own your house free and clear. <br><\/p>\n\n\n\n<p>Accomplishing these mid-life goals can enable you to achieve long-term goals. When your mortgage is paid off, you can then use that payment to travel the world or start a hobby refurbishing classic cars. Retiring early is now possible with the child\u2019s college paid or mortgage paid.<br><\/p>\n\n\n\n<p>Your financial plan has helped you create a life that\u2019s exciting. But what if things don\u2019t quite work out that way?<br><\/p>\n\n\n\n<h3><strong>How insurance plays a role<\/strong><\/h3>\n\n\n\n<p>It\u2019s uncomfortable to think about, but if you or your partner passes away early, there will be a big hole left in your financial plan. Saving each month for college or making mortgage payments becomes substantially more difficult. Your plan was built based on making payments, saving, and investing for years. When you or your partner no longer has those years, you need a contingency plan to fall back on.<br><\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p><strong><em>Life insurance is your contingency plan. You hope to never need it, but you\u2019ll be glad that it\u2019s there if you do.<\/em><\/strong><br><\/p><\/blockquote>\n\n\n\n<p>As part of your financial plan, life insurance will ensure you or your loved ones can cover the day-to-day responsibilities, like childcare and household bills. Not only that, it ensures that the big things are covered \u2014 like paying off your mortgage, funding your children\u2019s education, and making sure retirement is taken care of. <br><\/p>\n\n\n\n<p>Because you didn\u2019t have decades to make your plan work, life insurance steps in to fill the gap left in your financial plan.<br><\/p>\n\n\n\n<p>For example, let\u2019s say that you and your spouse are saving to send your child to college. You estimate that by saving $350 per month, you\u2019ll be able to send them to a great in-state school. Ten years into saving, your partner passes away and you have trouble making those monthly deposits into the college savings account. <br><\/p>\n\n\n\n<p>The previously well-thought-out financial plan is now no longer feasible, leaving your child with a college account that is only partially funded. If your partner had life insurance, the proceeds from the policy could help finish funding the college savings and your financial plan could stay intact. <br><\/p>\n\n\n\n<h3><strong>Term life insurance makes contingency planning easy<\/strong><br><\/h3>\n\n\n\n<p>Now that you know it\u2019s important, how do you get the right life insurance to support your family\u2019s financial plan? Term life insurance makes it easy. <br><\/p>\n\n\n\n<p>With term life insurance you choose the right amount of coverage for the right amount of time at the right price. <br><\/p>\n\n\n\n<p><strong><em>The right amount of coverage:<\/em><\/strong> Ladder term life insurance allows you to apply to increase or decrease your coverage as your life changes. As your kids graduate from college, your mortgage gets paid off, and your retirement nest egg grows, you\u2019ll need &nbsp;less insurance.<br><\/p>\n\n\n\n<p><strong><em>The right amount of time:<\/em><\/strong> With term life insurance a person pays a regular amount for coverage over a set period of time (the \u201cterm\u201d). If they die during that time, the insurer pays the coverage amount. You can choose a term length that will cover you when your financial plan needs it most, whether that\u2019s a 10-year term, a 30-year term, or something in between.<br><\/p>\n\n\n\n<p><strong><em>The right price:<\/em><\/strong> Term life insurance is also <a href=\"https:\/\/www.nerdwallet.com\/blog\/insurance\/what-is-the-difference-between-term-whole-life-insurance\/\">significantly cheaper<\/a> than whole life insurance for the same amount of coverage. That makes it easier for you to fit the insurance payments into your monthly budget. <\/p>\n\n\n\n<h3><strong>Protect your plan<\/strong><\/h3>\n\n\n\n<p>If you want to create a financial plan that will support your family no matter what unexpected situations come your way, term life insurance may be the piece that you\u2019re missing. If you want to figure out how much coverage you need, use this <a href=\"https:\/\/ladderlife.com\/calculator?lddr_source=ladder&amp;lddr_medium=blogpost&amp;lddr_name=calculator\">insurance calculator<\/a> to get an estimate and then start your application. <br><\/p>\n\n\n\n<p>And if you need a little more help figuring out what coverage options would work best for your financial plan, the friendly help at Ladder is <a href=\"https:\/\/www.ladderlife.com\/contact\">just<\/a><a href=\"https:\/\/www.ladderlife.com\/contact?lddr_source=ladder&amp;lddr_medium=blogpost&amp;lddr_name=contact-us\"> <\/a><a href=\"https:\/\/www.ladderlife.com\/contact\">an email away.<\/a> <br><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p><br><\/p>\n","protected":false},"excerpt":{"rendered":"<p>by Erica Gellerman, The Worth Project You\u2019re doing all of the things that signal you have your financial life together: you\u2019re paying down debt, you have a monthly budget, and you\u2019re putting money away for your golden years. But even though you\u2019re doing all of the right things today, do you know if you\u2019re covered should something unexpected happen down the road? Life insurance plays an important \u2014 but often overlooked \u2014 role in a financial plan. Only 60% of households have life insurance and the National Bureau of Economic Research reports that a significant number of households are underinsured. In this article, we\u2019ll break down how you can use life insurance to make your financial plan run smoothly, no matter what life throws your way. What\u2019s your financial plan? You may not realize that you have a financial plan, but if you\u2019re setting savings goals and putting away money for a rainy day, you\u2019ve created the start of your financial plan. The easiest way to think of a financial plan is as a roadmap for where you want to go in life. It starts by identifying where you are and breaks down exactly how you\u2019ll achieve those goals. Your [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":690,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[104],"tags":[55,41,7,38],"jetpack_featured_media_url":"https:\/\/i2.wp.com\/ladderlife.com/blog\/wp-content\/uploads\/2018\/12\/Holiday-Life-Insurance-Financial-Plan.jpg?fit=5184%2C3456&ssl=1","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v15.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Life Insurance: The Missing Piece in Your Financial Plan | Ladder Life Insurance Blog<\/title>\n<meta name=\"description\" content=\"Erica Gellerman breaks down how you can use life insurance to make your financial plan run smoothly, no matter what life throws your way.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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