| Why Do I Need Life Insurance.
Upon death of a breadwinner, the economic loss is the present value of his/her future income increasing with inflation to age of retirement.
If the breadwinner consumed 20% of this income for clothing and food, then his/her dependents will need 80% for shelter, food and clothing. The surviving spouse will have to save for retirement from this income.
Life Insurance provides tax free money at death to provide investment income which replaces earned income. This income will have to increase with inflation. |