Last week, browsing through the endless visage of space that is the internet, I stumped upon (without using StumbleUpon; it's safe to say that the web service has effectively killed an otherwise good expression) a forum where people were invited to post questions about their life insurance.
One quizzical questioner quipped, "Why do I even need life insurance? Can't I save the money myself?"
So Do You Need Life Insurance?
The answer, in most cases, is no. I say "in most cases" because there are always exceptions. For example, life insurance may be court-ordered as part of a divorce settlement; but in general, you have no legal obligation to purchase life insurance.
Now, before you sprint out of the room and dramatically burst into your insurer's office covered in sweat from the run, demanding that your policy be canceled, hold on a second...
Why You Should Have Life Insurance
While you don't NEED life insurance, I'm going to convince you that it's in your best interest to have it. The point of life insurance is that it gives your next of kin a payout if you die before you've saved enough money. The amounts vary, but the idea is that you pay a little, and get a lot should/when you pass away.
Without insurance, there's always the chance that you could pass away before you have enough money saved; and the small amount of money that you pay for life insurance most likely won't affect your saving potential in the long run.
And for you naysayers who are still convinced that you should put your life insurance money into savings instead, it's not easy to give your beneficiary access to your money in the bank.
Although in movies, a will is read and that's all, in real life your savings goes through probate; so anyone who you or your estate owes money to gets paid first, until all your outstanding debts are paid off.
Understanding Life Insurance Trusts: How to Reduce or Eliminate Your Estate Tax Cost(ankerreedhsc.wordpress.com)
Choosing Life Insurance (thesimpledollar.com)
What is commercial life insurance (wiki.answers.com)