Reader’s Question:

My wife just had our first baby here in Colorado and this got me thinking about our future, but I have no idea what life insurance policies are available! Can you help?

Dean

Fort Collins, CO

Congratulations on the baby! And it is also good to know that you immediately recognized the need for life insurance protection for your small family there in Colorado. Life Insurance is probably one of the most important purchases you will make in your life so it is important that you understand your personal financial goals for yourself and your family, especially in the long-run. That said, it is also vital to have a basic idea of what life insurance options are best suited for you or your family’s need. Below are some of the most common types of life insurance you will come across:

Term Life Insurance
One of the most basic and common forms of life insurance. Provides financial protection to your beneficiaries in case you pass away within the specific coverage period. This also happens to be where you can get the cheapest life insurance quotes and most can be renewed as needed.

Whole Life Insurance
Usually costs more in terms of premiums, especially in the initial years, but gives you a ‘cash-value’ option which is a low -risk form of allowing your money to grow. Premiums become level and more affordable in the later years.

Universal Life
Whole life policy that emphasizes on investing and growing your policy’s Cash-Value through Money Markets.

Variable Life
Similar to Universal Life but premiums are fixed and allows you to borrow against the cash-value of your policy, which can alter the total amount of death benefits remaining on the insurance coverage.