Nobody likes to buy life insurance, and you can't blame them. It isn't sexy, you can't drive it, wear it, or eat it. Plus, you have to think about morbid issues like death and dying, which are totally foreign at 32 or so. Add to that the confusion and complexities of the costs and thy types of policies and it begins to feel like a carefully crafted swindle. It also happens to be the most misunderstood area of the financial planning process.

A recent study by the Federal Trade Commission concluded that life insurance is so complex and policies and prices vary so greatly that the average consumer is usually unable to get an accurate understanding of what they are really buying. If you rely on the insurance agent to educate you correctly, you're making a serious mistake. Who really needs it? How much do you need to have? What should it cost? The questions can go on forever and most of us aren't even aware of what should be asked.

The myths and truths about insurance create such ambiguity around the subject that most people shy away from learning the basics. The special language of policies and their endless clauses and conditions is left up to the insurance agent, whose explanations usually don't really explain anything very clearly. Insurance is simply protection -- protection of your assets and more importantly, protection of yourself and your family.

The main purpose for life insurance is the death benefit and to protect your family from economic hardship in case of your death. Nothing more, nothing less. Life insurance is there to replace your paycheck and provide continuous income for your family and allow them to maintain their lifestyle.

If you're young, single, childless, with no mortgage and no aging parents depending on you, you don't need life insurance. The insurance agent will argue that you should buy it as an investment in your future while you're young, your health is good, and the rates are low but there are other investments that are a better choice at that stage of life.

If you have group life insurance plan through your job, that is probably enough to pay your final debts and give you a decent burial. If you are married, both working and have life insurance through your job you still probably don't need it, especially if you have no children, no mortgage, and no major expenses. But the young couple with children, future college bills, private school tuition, dental bills, summer camp fees, a mortgage, car note, and lots of credit cards, (your typical American family), needs as much coverage as possible but probably can't afford it. This can add up to more than $600,000-800,000. For a young father, 35, with all these financial responsibilities, a $750,000 death benefit could cost as much as $8,920 a year in a whole life policy or $410 a year in a term policy.

As you get older and plan to retire, your insurance needs should decrease. By then, the mortgage is usually paid off, the children are gone, and you've accumulated a good pension, or you should have. You will probably only need about $100,000 or $150,000, to supplement the retirement income for your spouse and to pay off any estate taxes that may arise for your children.

HOW MUCH INSURANCE DO YOU NEED
This is an ongoing debate. An industry rule of thumb is 5 to 8 times your salary, but that's not carved in stone. It really hinges on the number of people who depend on you financially and what other resources you have. If your assets are tied up in real estate or a family business that would have to be sold in order for your family to survive, you may need more than that. Most agents tend to think in round numbers of $100,000, $250,000, etc. Before talking to any insurance person, check out the facts about buying all forms of insurance at: www.life-line.org and learn what questions you should ask before meeting with an agent.

Review your own assets, debts, retirement plans and other obligations before you settle on an amount of life insurance coverage. Use www.smartcalc.com to help you know how much life insurance you need before calling a broker. You can also get objective answers without a sales pitch from customer service reps at Insuremarket at 800-695-0011.

SHOP AROUND FOR LIFE INSURANCE
A little comparison shopping before you sign on the dotted line can save you a bundle. These agencies represent over 3,000 companies and allow you to apply by phone or on the internet and no salesperson will bother you!

• Direct Quote 800-845-3853
• MasterQuote 800-337-5433 or www.Masterquote.com
• Quotesmith 800-431-1147 or www.termquotes.com
• Consumer Quote 800-845-3853
• If you're in the military, call USAA Life at 800-531-8000.

1. A. M. Best - www.ambest.com or use the Best's Review in the library.
2. Duff & Phelps - 312-368-3657 or www.dcrco.com
3. Moody's Investor's Services - 212-553-0377
4. Standard & Poor's - 212-208-1527.