If you are wondering how much life cover you need to make sure that your family is set, we have a couple of questions that you can use as a guideline to bring you one step closer to having peace of mind.
How much do you spend?
Your expenses will play a crucial role when it comes to determining how much life cover is enough. It could mark the difference between you needing R500,000 worth of life cover to get by or R10 million. Evaluating your expenses and keeping the cost of inflation in mind can give you an idea of how much life insurance you need.
Do you have any debt?
If you still need to pay off a house, car, education fees, a credit card or any other debt then you’ll need to take enough life insurance to easily cover this. Dying with debt to your name doesn't necessarily mean that all your debt will die with you.
The last thing anyone wants is having to transfer that debt to their loved ones who are still dealing with the emotional and financial implications of losing you. Going for debt counselling or speaking to a financial advisor can also give you good insight into how much life cover will be adequate.
Do you have any dependents?
If you have any siblings, parents, or extended family members that you take care of financially it is important to consider the financial implications that come with losing you as their breadwinner. Taking this into perspective can give you a realistic idea of how much they will need to continue with everyday expenses.
What is your salary?
Should there be a moment where you will no longer be able to earn a salary due to an illness, or in the event of death will you, or your loved ones have a plan in place that will assist you financially? Keep in mind that you can have life insurance and a range of investment portfolios that can protect your income and protect you from not being able to receive a salary due to a disability.
Will there be a shortfall?
While life insurance is a great way to protect you from a financial shortfall, keep in mind that insurers differ in terms of how much they will be able to cover you for. Your goal may be getting life cover to the value of five million rand, but due to a range of health issues, your lifestyle or your job you may only be approved for R2,5 million. The next step is to assess how you are going to cover the remaining R2,5 million.
Taking out life cover doesn’t have to be daunting. You can apply for an obligation free quote to get you started or use our life insurance calculator to calculate how much you will need in seconds. Have a chat with us to evaluate how a MiWayLife cover can benefit you and your family.
