Myth #2

Myth #2 I've got enough coverage through work.

This myth can also be devastating to a family in a couple of ways.  One of the most tragic is what happens when your company decides to "go a different direction", downsize, etc.  Or maybe in light of toughening economic pressures, and governmental changing regulations they become overburdened with the costs of providing these benefits and simply cut them out rather than cut you out.  If you don't have your own policy in place and your own financial protection plan this could feel a lot like getting kicked while your down.  Secondly, it is widely reported that even of those people who are fortunate enough to have this extra benefit through work, don't realize that it is not enough coverage for their situation.  I don't usually prescribe to rules of thumb since each individual situation requires an individual solution, but it can help conceptualize the amounts for you.  You should have enough insurance in place to simply provide the amount of income your partner would lose if you were to prematurely die, this way they are replacing your lost income.  A common rule of thumb for that is 8-10 times your annual salary.  If you're not married, you should have at least enough to cover your debt obligations and final expense costs.  Work based insurance should be treated as what it is, a benefit of your employment, not a primary source of insurance.  Take control of your own situation and make sure your family protection plan is sound.