Having life insurance can give you the peace of mind that your family will be taken care of in case of your unexpected death. Insurance can also be beneficial in an accident or a significant health problem. But with different types of insurance available, it can be difficult for people to figure out which is the right option.
However, if they turn to an expert such as Dave Ramsey for advice, they can understand insurance in a better way and make the right choice.
Who Is Dave Ramsey?
More commonly known as Dave Ramsey, David Ramsey is an American businessman and personal finance personality. He hosts a popular radio show where he answers finance-related questions. He has also written multiple finance books.
Dave Ramsey has created a budgeting system to help people manage their finances. He offers multiple free tools on his website to help people with budgeting. He is also known for his take on personal insurance.
What Is Personal Insurance?
Personal insurance covers all the types of insurance that provides protection to individuals and families. The most popular type of personal insurance is life insurance. A life insurance policy can provide financial security to your family in the event of your death or an injury.
Car insurance and healthcare insurance also falls under the category of personal insurance. In the event of an accident, it can give you the time to heal without having to worry about your finances.
Why Should You Get Personal Insurance?
Many people think that insurance is a waste of money because they haven’t got into an emergency yet. But it doesn’t take long for things to change in life, and when they do, you will wish that you had insurance so you wouldn’t have to worry about your finances.
Personal insurance is not just a way for you to protect the future of your family. It also saves you in the event of medical emergencies. Your brand-new car can get into an accident, but you wouldn’t have to worry too much about the damages if you have insurance.
If you don’t have personal insurance, you will fret over your finances anytime something goes wrong in your life. Financial stress can also keep you from getting much-needed rest. As a result, without insurance, your physical and psychological health might get poorer.
Insurance According to Dave Ramsey
A lot can go wrong instantly, and if you are not prepared to deal with it, you will suffer financially and psychologically. To avoid financial problems, Dave Ramsey recommends that a person must have the following types of insurance.
It is against the law to drive an uninsured car, but that’s not the only reason why you should get auto insurance. You can get liability, collision, and comprehensive coverage based on the auto insurance plan you choose. It can also cover you in case an accident happens.
If you are not sure what coverage you need, discuss your case with an insurance agent. They will guide you about the different types of coverage you can get.
Both homeowners and renters need insurance to get coverage for unexpected incidents. Homeowners must ensure that their policies come with flood insurance and earthquake coverage. If a natural catastrophe is common in your area, you can get it added to the coverage.
Renters also need home insurance to avoid financial problems if they lose their belongings in a fire or burglary.
If you get in a car accident where everything from medical bills and property damage ends up being more than what your auto insurance can cover, you might end up getting sued. If you cannot pay off the involved parties, you can end up losing your home and even your future wages.
To avoid such an unfortunate situation, Dave Ramsey recommends an umbrella policy. The insurance Dave Ramsey recommends can add an extra layer of protection to you and your assets. The amount of umbrella policy you get will depend on your needs.
Even if you don’t go to the doctor often, having health insurance is a must because without it, you can become a victim of a financial catastrophe with just one medical emergency.
Health insurance has a high cost, which is why most people avoid it, but it can be highly beneficial when you run into an unexpected medical emergency.
You can talk to an insurance agent to learn about the types of health insurance available today and then choose the policy that matches your requirements.
Long-Term Disability Insurance
If an accident leaves you with an injury and you fail to work for a few weeks, you will lose a significant percentage of your income. But if you have long-term disability insurance, you can relax while you heal from your accident and let the policy make up for the lost income.
There is also short-term disability insurance that can protect you if you are unable to work for three to six months. But if you get long-term disability insurance, you won’t have to look for other policies.
Term Life Insurance
A term life insurance can protect your family from losing their home in the event of your death. It provides complete coverage to all of your family members so they don’t have to worry about financial problems while grieving the loss of a loved one.
There are different types to choose from when it comes to life insurance. But according to Dave Ramsey, a term life insurance is a far better choice than a whole life policy.
Long-Term Care Insurance
If you want a comfortable life post-retirement or if you are living with a chronic illness or disability, getting long-term care insurance could be a good idea. Long-term care is generally costly. It is also not covered by Medicare, so it can be difficult for people to pay for it at once.
With long-term care insurance, you can ensure that you are taken care of after retirement. Getting long-term care insurance will depend on your family and medical history.
It may seem challenging to sign up for multiple insurance policies. But if you manage your finances properly, you can set aside a percentage of your income for insurance. You can also think of it as an investment as every type of insurance will benefit you in the long run. So, talk to an independent insurance agent today about your insurance needs and determine which policies you should buy.