Why life insurance is important
As long as you are alive and healthy, your income-producing capability is relatively secure, and you and your family can enjoy the lifestyle you have established. If you were to die, however, your family could face hard economic times. Your family's financial needs may include:
- Final expenses, such as burial and funeral costs
- Unpaid medical bills
- Income replacement
- Mortgage balance
- Debt repayment (credit cards)
- Education fund for children
- Emergency expenses
Why life insurance may be even more important when you're self-employed
As a sole proprietor, you are personally liable for all of the debts of your business. Legally, there is no difference between personal and business assets. By definition, a sole proprietorship ends when the owner dies. So, any losses or financial obligations at your death become the responsibility of your estate. It is possible that personal assets may have to be sold or transferred to pay off business debts. Business debts may include:
- Business loans
- Mortgage or lease payments on business location
- Payments due to suppliers, vendors, consultants, employees, and so on
- Taxes due to local, state, and federal taxing authorities
- Fees to lawyers, accountants, and other advisors to settle business affairs
Life insurance can be used to cover these debts, as well as to provide for the ongoing needs of your family after your death.
What to do about it
Ask your financial professional or insurance representative to help you assess your need for life insurance and design a program to fit your needs.
Securities and advisory services offered through LPL Financial, a registered investment advisor, Member FINRA/SIPC. LPL Financial and GENESIS Wealth Management LLC are separate entities.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly. The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal advisor. LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.