Life insurance or Investment? What to choose??

Life insurance should be purchased only for the period of your life when your family could not make it without you. For example, let us consider a 28 year old young man with a wife and children with insufficient savings or assets for them to live off of. If something were to happen to that man, it would leave his family in a bad situation. In this case if the man had a proper life insurance cover, it would take care of his family.

The opposite case would be a 60 year old man, retired from a good career with huge savings and wealth. Life insurance, would not be necessary because in the case of any tragedy, the family could continue to live in the same way from the existing wealth. Many wealthy families are “self-insured” in this manner across many risks.

This kind of sums it up: the people who need insurance the most are those in debt or with limited savings and resources. Those with lots of money have an investment problem and not an insurance problem. They typically use insurance as a way to minimize taxes.