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5 Things Freelancers Should Know About Getting Life Insurance

Freelancer, contractor, self-employed. Whichever job title you prefer, when you're going solo you understand the ever-changing demands of life.

From those last-minute project changes for your online clients to an overwhelmingly busy day at your small independent bakery. However, having full control over your work days is why you chose your flexible career path. So, whether it's a parent or child who depends on you, freelancing gives you personal autonomy over your schedule so you can give your time to others. But what happens if you're not there to take care of your loved ones?

Unfortunately, we won't always be around to offer support, but we can put safeguards in place. With life insurance, we're taking measures to help ensure that our dependents are taken care of in the unfortunate event of our passing. It's not only future protection but its peace of mind, knowing the money we leave behind can provide care to our relatives when we no longer can.

Finances aren't always predictable for freelancers and therefore life insurance is not always a top priority. However, thinking ahead is just as important as thinking of the present where money is concerned. If you're on the fence about life insurance it's important to make sure you've gathered all the facts so you can take the necessary steps to protect your family's future.

Can I Deduct Life Insurance If I Am Self-Employed?

Being self-employed allows you the freedom to choose your own hours and projects. However, it may also come with many expenses, including the cost of life insurance. In the absence of employer-paid life insurance coverage, self-employed professionals need to be able to find the life insurance coverage they need to help protect their loved ones. Many of the expenses you pay as part of being self-employed are tax-deductible, but, unfortunately most life insurance premiums are not.

What the Self-Employed Should Know About Life Insurance

1. Life Insurance is More Affordable Than You Might Think

According to the 2018 Insurance Barometer Study by LIMRA and Life Happens,¹ 63% of respondents believe expense is one of the main barriers preventing the purchase of life insurance. However, the same study highlighted the fact that most respondents overestimated the cost of coverage at over 3 times the actual cost.

Finding a life insurance policy that fulfills your requirements, while sticking to your budget, is actually more financially viable than you might have first thought. You might find you already have the financial bandwidth required for a comprehensive policy that helps ensure your loved ones are taken care of in the future.

2. Term Life Insurance May Be Your Preferred Policy Type

Unlike whole or universal life insurance, term life insurance covers you for a specified period of time, commonly between 10 to 30 years. With a limited policy date, term life insurance has cheaper premiums than more permanent alternatives due to the limited time a claim can be made.

If you're looking to keep your life insurance premiums to a minimum, term life insurance is a great option. You can protect your financial dependents up until they become financially independent, for a policy that's as flexible as your freelancing career.

3. You Have the Freedom to Select Your Own Life Insurance Policy

Going solo means you'll no longer receive life insurance benefits from employers, but being your own employer gives you more onus on policy coverage so you can be assured that your family will have the finances they need. By taking out your own coverage, you award yourself the flexibility to change job roles without worrying about the state of your life insurance policy. So if a change from an online consulting business to a brick and mortar accounting firm takes your fancy, you'll simply need to update your employment details without the stress of qualifying for a completely new policy.

4. You Can Calculate The Policy Coverage You Need

Without a set income, it can be difficult to calculate the coverage you need. However, our handy Term Life Insurance Calculator only requires your approximate annual income. Simply take your last 12 months of earnings to get a quote the reflects your financial requirements.

If you're looking to max out on coverage we recommend multiplying your highest month of earnings or profits by 12 to give you a policy quote that fulfills your needs and more.

5. Freelancing Frees Up Income For Your Life Insurance Premiums

Going career independent may free up more income than you may think. Working from home, or premises closer to your neighborhood, can not only reduce the cost of travel to and from the office, but it may mean less money spent on lunches and office outings that can drain your resources. Instead, you can spend your hard-earned cash on a life insurance policy that offers the protection needed for your family.

Life insurance is vital no matter your career choice. If self-employed life has been holding you back from purchasing your own policy get in touch with our team of experienced life insurance agents who will help tailor your custom plan today.

1. https://lifehappens.org/blog/2018-barometer-study/