Here's how it works. As an employee, you can elect to have a percentage of your salary withheld each pay period. While saving for retirement is critical, don't overlook the importance of having adequate life and disability insurance. Life insurance provides liquidity upon your death to pay down debts, funds the education of your children, helps your family maintain its standard of living, or covers your spouse's retirement. Disability insurance provides protection in the event that you can't work due to illness or injury.
Most employers provide their employees with some level of life and disability insurance.
Meet with your company's benefit department to determine the amount of coverage you are receiving. Ask how much your benefactors would receive from your life insurance if you died. Even though you may receive life and disability coverage from your employer, the coverage is probably not sufficient to provide adequate protection. It would be too expensive for employers to provide that much insurance for their employees. Meet with a CPA or financial advisor to get an objective review of whether the insurance you are getting from your employer is sufficient to meet your needs.