DON'T FAIL TO PLAN: LIFE INSURANCE HELPS LIVING PEOPLE

To recap, purchasing life insurance today can protect your future insurability. Some day, you may have a family. Life insurance, once issued, is in force for life, assuming you buy whole life insurance.

Despite any future changes in your health, with permanent life insurance you can lock in the premium rate for life.

Premiums at issue are lower for younger men and women, increasing each year. However, you can "freeze" those rates at the age of issue, so it is possible to pay the same affordable premium rate when you are 70 that you did at age 25.

Another mistake is not having enough life insurance. We're quick to insure our cars and our homes, but too often we overlook our most important asset: ourselves.

With mortgages, tuition and bills to be paid, it's important to have proper coverage.

Some people may have group-term life insurance through their employers, but this alone may not be sufficient.

Be careful not to be overly dependent on these plans, as they can be inflexible and may not be portable. They may not be available when you need them most: after age 65.

Look into purchasing individual coverage to suit your particular needs. How much life insurance is enough? Remember that it is not the number of polices a person has that counts, but rather the value of those polices.

Life insurance pays not only if someone dies, but also when someone lives. In fact, living benefits paid out to policyholders far outweigh death benefits paid. Ideally, people should have enough life insurance to create an income when they retire that will free them from being dependent on anyone other than themselves for the rest of their lives.

Mortgage insurance is also often overlooked when it comes to protecting your greatest asset: your home.

You are a proud owner of a new home, rental property or real estate, and you've received a mortgage because the lender felt comfortable with your income level and financial situation.

But what happens if you, as the primary income producer or even as half of a dual-income situation, die? Besides the emotional trauma, a surviving spouse could experience a significant drop in household income, leading to severe financial problems that could lead to foreclosure.

That's why many banks and mortgage companies encourage home-owners to purchase mortgage life insurance. Basically, you purchase it so that in the event of untimely death, funds are available to meet outstanding mortgage balances.

You pay the premiums, and the lender receives the proceeds upon the insured person's death. Your family receives the deed to the house, and no additional payments to the life-insurance company are necessary.

Finally, there is the failure to plan. An old saying goes: "Most people don't plan to fail, they simply fail to plan."

This is particularly true when it comes to life insurance. To have a realistic chance of achieving the financial objectives we want to achieve for ourselves, we must first set our goals, analyse what it will take to achieve those goals and then implement a plan.

Sure, everyone makes mistakes, but all of the ones outlined here and in last week's article can be avoided. With proper insurance products and financial strategies, you can steer past those costly blunders and be on the road to financial success.