The following is a guest post about single life insurance. If interested in submitting a guest post, please read my guest post policy and then contact me.
Necessary? No. Good for financial pre-planning? Perhaps. The answer to this question greatly depends on what you want for the future, how much that’s going to cost you later, and what kind of financial pre-planner you are.
I’m in my 20’s & Don’t Have Any Family Plans on the Horizon
In this case, making a life insurance purchase right now would probably be an unneeded extra expense at a time where you’re probably just learning how to save money and take care of yourself. I’ve been in this position, myself, and sending any amount of extra funds out the back door towards something so far in the future just didn’t fit at the time.
If you’re not even in a committed relationship, or even a relationship at all, then more than likely you can hold off at least a few years on making a life insurance purchase, without it making much of a difference.
That being said, however, it’s a really good idea to recognize when those tides are changing and at what age life insurance premiums start to rise – there’s a sweet spot that can be found to set yourself up for less financial hardship later.
I’m Still Single, but I’m Looking for that to Change Soon
This is a whole other phase of life and most of us don’t recognize it until we’re sitting at a wedding and this thought dawns on us – “this is something that I want”. Here’s that sweet spot that I referred to a moment ago and it’s important to pay attention to.
At this point, you’re probably in a place where you’re more settled with life. Perhaps you have a career going, some money in the bank, and are starting to think about what you want over the next decade. If that includes finding a partner and starting a family, then it’s not a bad time to start considering a life insurance purchase.
Let me clarify that it isn’t a necessary time to start thinking about life insurance – it’s only really necessary when you have a spouse and a child on the way that you are now financially responsible for. It can, however, be a wise decision – one that may save you hundreds of dollars per year right when you need that money the most.
The Benefits of Pre-Planning
While you’re in your 20’s, even if you’re heading towards the later years, life insurance companies don’t see you as a risk – unless, of course, you’ve had any significant medical situations. Right now, it’s a safe bet for them that you’ll be around for a long while, paying your premiums, and therefore are very attractive to a life insurance company. They want you – and they’re willing to give you a great deal on premiums, because in the long run, it’s going to be a mutually beneficial arrangement.
At this age and time, you can pick up a fantastic $500,000 insurance policy for $350 to $400 per year, which is way more than you really need at this juncture. This policy, though, will set you up for the next 30 years and any number of things can happen during that time. If you’re already thinking about finding a partner and settling down, then chances are that will occur within the next 30 years, right? Right.
Everyone knows that starting a family isn’t cheap – there’s a lot of expenses that come along with sharing your life with someone and bringing babies into the world. The trick with life insurance is to not wait until it’s more expensive, right when everything else in your life is getting expensive. For obvious reasons, this is why a great deal of American families don’t have life insurance – it’s too much, too late.
Secure Your Family’s Financial Well-Being – Don’t Wait
Within the life insurance industry, there exists a research outfit called LIMRA, which solely exists to collect information about the state of life insurance within America. As of 2012, one of their reports concluded that a whopping 64% of American families had no life insurance coverage whatsoever. When polled, families stated that the main reason they hadn’t made a life insurance purchase was simply that they couldn’t afford it.
With the American economy having suffered greatly over the last few years, this really isn’t surprising, but the economy isn’t the only thing to blame. There’s also a substantial lack of education about what life insurance is, what it can do for a family, and what the consequences are, down the line, when tragedy strikes.
One of the best possible things that you can do, even if you’re currently single, is educate yourself. Meet with a financial advisor, outline what you’re looking to accomplish over the next decade or two, and plan accordingly. Don’t take my word for it – do your own research and set yourself up for success. You’ll be surprised how easy and inexpensive it is to understand how your finances will change going forward and how you can experience huge payoffs down the road, through small sacrifices now.