When it comes to life insurance, many people have coverage-related questions. Indeed, it can be very tricky because every individual’s and family’s life insurance needs are different. In our experience, investor confusion often leads to coverage gaps, meaning many people are significantly unprepared for the unexpected.

Consider that only 44 percent of U.S. households had individual life insurance in 2016, according to LIMRA, an insurance industry research organization. What’s more, LIMRA data from last year shows that one out of five households with children under age 18 is uninsured. Of these families with no coverage, a disturbingly large number—62 percent—say they would be in immediate financial trouble if the primary wage earner died.

Despite its many benefits, people tend shy away from life insurance for several reasons. For one thing, it’s uncomfortable to plan for your future death. Some people are also under the mistaken impression that you have to be wealthy to afford life insurance. Others mistakenly believe that life insurance is only for people with dependants.

The reality is, however, that planning for the future—including your eventual death—is a critical part of life. What’s more, term life policies that offer adequate protection for you and your loved ones can be purchased at a relatively young age for reasonable rates. Importantly, life insurance is appropriate for anyone who needs to cover the cost of medical care, personal debt, funeral expenses and the like. This is true whether or not you have a spouse or dependants.

There’s also a lot of confusion about how much insurance is enough. There are some general rules of thumb, but the reality is that each person’s situation is different. To get a better understanding of your needs, take a look at your long-term financial obligations and your assets. The remainder is the gap that life insurance should seek to fill. You should also factor in other plans you may have through your employer, but keep in mind that many times these plans are not portable, meaning you can’t take them with you when you leave the company. What’s more, the coverage levels offered by your employer may not be enough to adequately provide for your spouse or other dependents.

The advisors at Anderson Retirement Solutions can help you work through the calculations so you aren’t significantly over insured or deeply underinsured given your personal situation. Keep in mind life insurance should be part of your overall financial plan and take into account future expenses and the projected growth of your assets.

Certainly, there are all kinds of life insurance, and there is no single policy that’s right for every client. However, people shouldn’t let fear of the unknown deter them from making sound financial decisions that could affect their family’s well-being years down the road. Permanent policies, which provide lifelong protection and the ability to accumulate cash value on a tax-deferred basis, can be very effective as part of a long-term financial plan. Some people mistakenly believe that the need for life insurance ends after children have graduated college or the mortgage has been paid off. But life insurance can help ensure that your spouse is provided for and that you have a legacy to leave to your heirs—even many years after you are gone.

At Anderson Retirement Solutions, we can help advise you on your insurance needs to help prepare you and your family for a financially secure future. Please don’t hesitate to contact us at 888.473.6931 to discuss how life insurance can fit into your overall plan.