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Costs Associated With Dying
You might think that once you die your financial worries are over, but the truth is that dying isn’t free. There is the cost of the funeral to think about, any medical bills that have piled up, unpaid debts and taxes, and needs of your survivors to think about. This is where having life insurance pays off.
Funeral Costs
The average funeral these days costs around $7,000. This includes the cost of a cemetery plot ($400-$600), an opening fee (digging fee--$400-$600), the vault (around $1000), services (funeral home services, embalming, any outside services needed such as officiator, organist, etc.--around $3000), and the casket. Standard caskets start at around $2000, but there are certain types, such as mahogany, that can cost as much as $10,000 or more. You also can opt to be cremated, which will cut the cost of the funeral. Cremation after visitation services costs around $5000, while immediate cremation costs around $1000.
Medical Bills
Doctor and hospital bills can pile up quickly as well, even with health insurance. Unfortunately, having health insurance doesn’t always make healthcare cheap, especially because the coverage varies as far as what it will and will not pay for, and how much it will pay. If you are subject to a long illness before death, or are in an accident and require a good deal of medical attention, the amounts of these bills can quickly rise into the thousands.
Debts and Taxes
Unpaid debts are still the liability of the family of the deceased. These can include your remaining mortgage, any personal or auto loans, and credit card debt. This of course varies from person to person, but your family is still financially responsible for your debts, which can have a great impact upon their financial situation after your death. Estate taxes are also something to think about. If your estate is over $675,000, which with inflation is becoming more common, estate taxes start at 37%, which averages out to about $250,000. Keeping a policy separate from the estate can cover these costs, which can also have a great impact upon your family’s financial situation.
How Life Insurance Helps
Your survivors will have needs after your death, both immediate and long-term. They will still need to purchase day-to-day items, such as groceries, personal items and gasoline, and pay for utilities and services. If you have children, you have their education to think about, which continues to increase in cost, and for your partner or spouse, their future and possibly their retirement.
By considering all of these issues, having enough life insurance is feasible. Too many people only consider the smaller aspects of the costs of dying, such as the funeral services, leaving their families to cover the rest of their debts. There is so much more to think about, and by preparing yourself, you can prepare for your family as well.
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