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Why You Should Choose Life Insurance Over Crowdfunding

Written by: MJ Gissas

There is a recent trend in the modern financial climate and age of prolific internet connectivity of crowdfunding financial help in crisis situations. In the event of an unexpected death, men and women are looking to publicly sourced financial backing from websites such as GoFundMe.

The problem with relying on crowdsourcing has quite a few layers. When compared directly with life insurance, crowdfunding is:

  • Unreliable
  • Unpredictable
  • Low-Yield

Even though life insurance requires an initial investment, it guarantees a significant payout that can cover some of the most demanding costs of a death in the family.

Crowdfunding Is Unreliable

In a crisis, there is no doubt that you will need money. Major health issues, accidents, and deaths (especially when unexpected) leave family members with bills to pay and expenses to cover.


No one wants to gamble while dealing with an emotional and financially strenuous life event. But crowdfunding IS a gamble – even if you’re surrounded by generous family and friends, you may still make as little as $0 from a crowdfunding effort.


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Crowdfunding Is Unpredictable

Should you enjoy some impressive generosity, you may near your goals and receive some serious help covering healthcare or funeral costs. Or at least, your pledges will promise you the money.

Some crowdfunding websites allow men and women who pledge money to stop payment. Despite the number promised on your crowdfunding page, you may only receive a fraction of the pledged funds, which is another piece of an already hard-to-predict puzzle.


Crowdfunding Is Low-Yield

In most cases, the final pledged number (which, remember, is likely to be larger than the actual payout of a crowdfunding effort) is not likely to be anything over $2,200. That’s the average total amount raised among 22,000 different funeral and tribute crowdfunding campaigns on GoFundMe.


Life Insurance Is Not a Gamble

What’s great about life insurance is that you can count on a solid death benefit depending on the coverage you choose when selecting your life insurance plan. People tend to fear the life insurance premium, especially since it climbs as you age, but with proper planning and financial responsibility, the death benefit far outweighs the premium, and you can absolutely count on it.

Americans for Life provides guidance for those seeking life insurance plans but are unsure what to look for. Find out how we can help you avoid the troubles of crowdsourcing for the unexpected.

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Americans for Life Financial Services offers retirement solutions for institutional investors and individuals. Knowledge and results help our clients make informed decisions to meet their financial goals. 

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