January marks Financial Wellness Month, making it an ideal moment to revisit your money habits and overall financial strategy. One area that deserves more attention than it often gets is life insurance. Many people assume it’s only relevant later in life, but it can actually play a meaningful role in your financial wellbeing at every stage.

Life insurance can help safeguard your loved ones, create stability during difficult moments, and in some cases, even contribute to your own financial planning goals while you’re still here. Below, we’ll explore what life insurance does, the types of policies available, and how to keep your coverage aligned with your evolving needs.

What Life Insurance Really Provides

Life insurance is designed to pay out a death benefit to the people you designate. This lump sum can help cover major expenses such as housing costs, outstanding debts, final arrangements, childcare needs, or everyday living necessities.

In essence, life insurance acts as a financial safety net, helping your family stay on track if something were to happen to you. It provides readily available cash at a time when it’s needed most, turning an overwhelming “what if” scenario into a more manageable situation.

As long as you pay your premiums as agreed, your insurance company guarantees a payout under the policy’s terms. That assurance is one of the main reasons life insurance is considered a foundational part of preserving long‑term financial wellness.

Understanding Term vs. Permanent Life Insurance

Life insurance generally falls into two categories: term and permanent. Each serves different purposes, and the best fit depends on your personal goals, budget, and long‑term plans.

Term life insurance offers coverage for a defined period—typically 10, 20, or 30 years. If you pass away during that timeframe, your beneficiaries receive the death benefit. If the term ends before anything happens, the policy simply expires. Term coverage is usually more budget‑friendly and is popular for seasons of life when responsibilities and financial commitments are at their highest, such as raising children or paying off a mortgage.

Permanent life insurance lasts for your entire lifetime as long as premiums continue to be paid. In addition to lifelong coverage, it includes a cash value component that grows over time. This savings-like feature can be accessed through loans or withdrawals while you’re alive, though doing so may reduce your eventual death benefit.

Two well‑known types of permanent coverage include:

• Whole life insurance, which provides set premiums, guaranteed cash value growth, and a fixed death benefit. It’s steady and easy to predict long term.
• Universal life insurance, which offers more flexibility. You can adjust your premiums and death benefit, and the cash value may grow based on market factors. While this flexibility can be appealing, it may also come with additional risk depending on market performance.

Both forms of permanent life insurance can be helpful for those seeking lifetime protection or a policy with an added savings element.

Should You Consider Cash Value?

The cash value feature in permanent policies can be a helpful supplement to your financial plan. Over time, it can potentially support large expenses such as medical costs, education needs, or even retirement income.

Still, it’s important to understand how this benefit works. Cash value accumulation usually starts slow, and taking out loans or withdrawals can reduce the final payout your family receives. Permanent policies also tend to cost more than term coverage.

If you already know you want lifelong protection or like the idea of fixed premiums, then cash value may be a meaningful feature. But many people should prioritize funding other savings tools—such as emergency funds or retirement accounts—before relying on a life insurance policy for investment purposes.

Enhancing Your Policy with Riders

Life insurance isn’t one-size-fits-all, and riders allow you to customize your policy to suit your needs. These optional features can add valuable flexibility and protection.

For example, a long‑term care rider can help cover costs if you need ongoing care due to illness or injury. A terminal illness rider may let you access a portion of your benefit if you receive a qualifying diagnosis. If you choose a term policy, a return of premium rider could refund the money you paid in if you outlive the contract.

Some term policies also offer the option to convert to permanent coverage later on—without undergoing a new medical exam. This can be especially helpful if your health changes over time and you want the security of lifelong protection.

These add‑ons can make your policy more adaptable and aligned with your long‑term goals.

How to Keep Your Coverage Current

Part of staying financially healthy is making sure your life insurance continues to reflect your needs. A yearly check‑in can make all the difference.

• Review your beneficiaries annually. Life changes like marriage, divorce, or having a child can make updates necessary.
• Check your coverage amount. If your income, debts, or family responsibilities have shifted, you may need more—or less—protection.
• Know your options. If you have term coverage, see whether it includes a conversion feature in case you decide later on that permanent insurance makes more sense.
• Make policy reviews a routine. Treat your life insurance like your budget or savings plan and revisit it each year.

If you’d like help assessing your current policy or exploring new options, reach out anytime. We’re here to help you protect the people and priorities that matter most.