A 'death benefit' can replace lost income, pay for a funeral, or leave a legacy

Life insurance can can cover funeral expenses, loss of income, and more

Life insurance can act as a financial safety net if your main financial provider dies. Among other things, it can cover any debts that were left behind. In this video, a Yahoo Finance contributor dives into why life insurance could be the key financial protection your family needs.

Life insurance policies are often recommended for people with financial dependents

If you’re a parent, spouse, business owner, homeowner, or if you hold a lot of debt, you might want to consider life insurance. It can replace a loss of income or pay off debt.

Life insurance offers peace of mind, ensuring that loved ones are financially supported after one's passing

People typically apply for life insurance policies through specific companies or online marketplaces. This video offers more information that's important to know when considering buying life insurance.

People can customize their life insurance policies by adding on extra benefits

While most life insurance policies have similar coverage, adding on these extra benefits (called riders) can help make these policies more bespoke. Some common added benefits include coverage for your children, a high-risk lifestyle, or a critical or terminal illness.

Permanent life insurance policies can sometimes help you cover expenses, access cash, and more

If you’re planning on purchasing permanent life insurance, your policy will come with a cash value (which acts like a savings account). To make the most of this account, you could pay your life insurance premium, apply it towards a loan, or put it towards long-term or terminal care.

Life insurance policies and annuities are both contracts between individuals and insurance companies

But while life insurance policies are paid out only after an individual dies, annuities are intended to provide a steady income while the investor is still alive. Also, life insurance protects an investor's family in the event of their death, but an annuity helps protect an investor from outliving their retirement savings.

Most life insurance policies cover death by natural causes or accidents

However, some other causes aren’t always covered. Suicide in the first two years of coverage, high-risk activities or jobs, and war or terrorism aren’t typically covered by life insurance, for instance. However, some added benefits (or “riders”) can account for some of these situations.

Life insurance premiums can cost anywhere between $80 and $1K a month, depending on the policy

A life insurance premium is essentially the monthly cost or fee someone pays to an insurance company in exchange for a specified sum of money after their death to their beneficiaries. Factors like term length, health and lifestyle, and any added benefits can impact your premium.

Annuities differ from life insurance policies in a few key ways, such as when they're paid out and who they benefit

Annuities are intended to benefit the plan owner, and benefits are paid out during the owner's life. The person who buys life insurance rarely sees those benefits—they're intended instead for heirs and dependents.

Final life insurance is most common for people over the age of 50

Final expense life insurance is a type of life insurance where, instead of paying a sum of money to your beneficiaries after death, the insurance covers the expenses for your funeral, burial, and any end-of-life care.

When a pension holder dies, payments are sometimes passed on to a relative

Those relatives are often the pension holder’s surviving spouses or dependents. This article offers tips from a financial expert on how to make sure your spouse is taken care of during retirement, including navigating a pension’s ultimate destination.

Permanent life insurance offers access to a cash value account, which is like a savings account

It's a huge perk of purchasing permanent life insurance. Policyholders often use these accounts as another investment tool. In this podcast episode, NerdWallet experts break down how you can use your cash value account to invest, plus the pros and cons of this tactic.

Annuities can help protect investors from outliving their retirement savings

While an annuity is also a contract between an individual and an insurance company, a life insurance policy differs in that it protects the beneficiaries in the event of the policyholder’s death.

A life insurance cost calculator

The overall cost of life insurance coverage ranges widely. Factors like your term length, death benefit (the money paid out after death), health and lifestyle, and any added benefits can drastically change your monthly cost. This calculator can help you determine how much your desired coverage could run you per month.

If you decide to buy term life insurance, coverage will eventually expire

If you decide to buy term life insurance, you’ll no longer have coverage once the agreed-upon timeframe is over. You can always plan ahead to pay off major expenses before your coverage ends, but if this doesn’t happen, you may need to renew or replace your policy.

Death taxes are placed on a deceased person's estate

Death taxes can include liquid cash, property, stocks, or other financial assets they owned. There are two main types of death taxes in the US: the estate tax and inheritance tax. Death taxes are levied at the federal and state level, but are targeted towards the rich.

Some people don't like talking about life insurance—perhaps because they fear death

But CBS News business analyst Jill Schlesinger makes a case for why life insurance is worth discussing anyway on this "CBS Mornings" segment. She also reviews the different types of life insurance, who can be a beneficiary, and other basics.

Annuities are financial products typically used by retirees looking for guaranteed income streams.

The two main types of life insurance are term and permanent

The biggest difference between the two is how long they cover the life of the insured person and how much they cost. This guide can help you learn more about term and permanent life insurance, plus their different variations, to choose the right policy for you.

Trusts offer ways to reduce the taxes beneficiaries pay on assets in one’s estate

People of different socioeconomic classes often decide to establish a trust to avoid certain taxes. When someone dies and leaves assets to beneficiaries in a will, those beneficiaries must pay specific taxes a trust's beneficiaries avoid. It all depends on the type of trust.

Whole and universal life insurance are two types of permanent life insurance

While they both stick with you for your whole life, they vary when it comes to added benefits, overall cost, and changes you can make to an active policy. The biggest difference between the two is that universal insurance lets you make changes to an active policy, whereas whole insurance is fixed.

Paperwork errors cost families millions in life-insurance payouts

This podcast episode reveals how human missteps by employers and insurance providers caused hundreds of families who paid life-insurance premiums to be denied millions of dollars in death benefits. A Wall Street Journal reporter breaks down how flaws in the system made this happen.

Gifting money is one way to avoid death taxes

Gifting money while you're alive is one way people avoid estate and inheritance taxes. There is a yearly cap on how much you can give to a person before that money is taxed—but there isn't a cap on how many people you can give money to in a year.

Term life insurance costs about $80 per month

Permanent life insurance, on the other hand, can run you anywhere between $540 and $700 a month. However, the average monthly cost can vary depending on your age, sex, and policy type.

Estate taxes are paid out of the estate, while inheritance taxes are paid by beneficiaries

When a person dies, any estate taxes owed are paid out of their finances before being transferred to their beneficiaries—unlike inheritance taxes that are paid by the beneficiaries themselves. In addition to a federal estate tax, 12 states and the District of Columbia have a state estate tax with varying rates.

Cash balance pension plans provide the option of a lifetime annuity

Specifically, these defined-benefit plans are retirement plans that differ from traditional pensions in that they can come in one lump sum rather than in monthly payments. These plans are most popular among small business owners and their employees. Learn more about them in this article.

Mortality tables help determine the probability of death for specific populations

A mortality table is a diagram that helps predict a specific population’s likelihood of death within a particular time period. Life insurance companies often use them to help figure out pricing for their insurance products. They’re sometimes known as actuarial tables or life tables.

Probate is a legal process that determines if someone’s will is valid

The executor of the will in question not only collects estate assets, but also pays outstanding taxes and more. Grantors sometimes opt for a revocable trust instead of a will so their assets avoid probate in the event of their death.

How much tax you would owe on a $14M inheritance

“Death taxes” refer to estate and inheritance taxes—fees imposed on wealth transfers after someone passes. While the federal estate tax only applies to estates over $13.61 million in 2024, some states, like Washington, have their own taxes.

An online presence provides a means of grieving and honoring individuals after death

Shifting perspectives toward the increasing importance of digital profiles of the dead have made anticipatory management of one's digital legacy more critical. Experts suggest choosing a tech-savvy relative—such as a cousin—over a spouse to reduce confusion about what to preserve or discard, as well as how to access password-protected content.

Mortgage insurance offers help to buyers who can’t afford to put down 20% up front

Buyers who need mortgage insurance end up paying more per month on top of their loan to cover the added insurance. At its core, mortgage insurance helps buyers purchase a home they can’t afford, letting them put down 20%, while protecting lenders offering potentially risky loans.

While annuities can guarantee an income for risk-averse investors, they may play it too safe for others

Whether or not an annuity is the right investment option depends on the buyer’s unique needs. People who plan to retire soon are more likely to opt for the lower-risk investment, but there may be opportunity costs for people seeking higher returns.

If someone buys a $100K annuity, they may receive $525 to $1K monthly payments

In general, how much an annuity will pay out depends on a variety of factors, including how old an annuitant was when they bought it and what type of annuity they bought. Regardless, annuities can provide a guaranteed extra income for retirees.

What is the unlimited marital deduction?

One big way to avoid paying several death taxes? Get married. The unlimited marital deduction allows an individual to grant all their financial assets to their spouse while they're alive or after they’ve died without having to pay the federal estate tax or gift tax. There are limitations to this rule. For instance, how it works with state death taxes. Learn more here.

Death taxes have helped fund wars since the 1860s

Death taxes date back to 700 BCE and were used in Ancient Rome and Ancient Egypt. In the US, they've been used to finance wars since the Civil War, and have been levied on both the estate and beneficiary. The estate tax created during WWI to help finance war efforts is still in effect today.

Lottery winners have two choices: lump sums or annuities

Lottery winners can receive either a lump sum or a yearly payout for 30 years. If they take the lump sum, they can receive only about 60% of the winnings—and that 60% is then taxed. If they choose to receive the annual payout as an annuity, there are tax strategies they can use to minimize how much they owe.

'Payment in kind' is a compensation method that uses alternatives to cash

Companies can make payments using goods, services, or additional securities instead of cash, helping companies preserve their cash flow. Public BDCs receive roughly 8% of their investment income via PIK.

Only 5 states have inheritance taxes

Unlike estate taxes, inheritance taxes paid by the beneficiary of the estate (the person who inherits the deceased person's financial assets). The federal government doesn't levy an inheritance tax, but five states do. They all have varying tax rates and rules.

Some argue that annuities are particularly good options for women

Women live longer than men, meaning they'll likely be retired for longer. Annuities can provide them with a guaranteed income stream during their retirement years, even if the rest of their retirement plan doesn't last.

Certain trusts can bypass estate taxes—but the terms can't be changed

Putting money and other financial assets in an irrevocable trust is one way to avoid estate taxes. There are some cons to this trust, like the fact that you can't change the terms of the trust or assets in the trust after they're set. But a big pro is that any financial assets in an irrevocable trust aren't considered part of your estate, meaning they aren't subject to death taxes.

A growing number of Americans are leaving trust funds behind for their pets

A pet trust ensures that an animal receives financial support and care if its owner can no longer care for the pet. Some lucky dogs have inherited millions of dollars from their owners.

Afterlife traditions help some humans process death

Watch this video discussing concepts of the afterlife presented through an anthropological lens about one family's experience and traditions passed down from one generation to another.

Annuity sales have climbed, topping $430B in 2024, as retirees look to pad their income

Retirees are seeking guaranteed income that will last for as long as they live, weather market downturns, and preserve wealth.

It’s not always clear whether a will or a trust is the best for an individual estate

While trusts are typically more expensive to set up than a will, they also help beneficiaries avoid specific types of taxes, depending on the type of trust. Wills typically go through probate, whereas trusts do not. An article offers a list of questions to consider when deciding between the two.

Insurance 'float' is money collected based on insurance’s pay now, collect later model

The insurance “float” has treated Warren Buffett well. The “float” has earned him, and Berkshire Hathaway, billions of dollars. This article includes a letter from Buffett to Berkshire Hathaway shareholders in 2009, discussing the impact of the “float” on his long-term success.

Revocable trusts are typically subject to estate taxes

Irrevocable trusts, however, are not. Both types help beneficiaries avoid probate, the lengthy court process that administers a person’s estate upon death.

Read what actions helped support grieving individuals during times of anguish

Concrete acts of kindness that buoyed New York Times readers after the deaths of loved ones varied widely. Examples include: friends sending emojis requiring no reply, coming over without asking to clean a grieving individual's bathroom, feeding them, taking them for periodic outdoor walks, and simply sitting with them so they weren't alone. (Some users may experience a paywall.)

Opponents of the federal estate tax began using the term 'death tax' in the 1940s to sway public opinion.

In China, deepfaking a dead loved one has become a growing industry

Digital replicas of the deceased provide individuals with another way to process grief in a culture with long-standing traditions of communicating with ancestors. The emotional and ethical implications of "digital immortality" are complicated further by cases of actors impersonating deceased relatives during deepfake video calls to hide their deaths.

Half of the richest people in the US are finding ways around death taxes

One of the main purposes of the federal estate tax is to crack down on generational wealth, so wealth isn't concentrated among a select few. However, the ultra-rich have found ways around paying these taxes. This ProPublica article investigates the practices used by half of the 100 richest people in the US to avoid death taxes.